Cement market rally will continue till Diwali: Coal shortage hits production

- It may take some time to reach the level of cement production before the Corona period.

Recently, the equations in various commodities in the energy sector have been rapidly changing in the country's markets and overseas markets. New York crude prices have soared to a three-year high on the back of a recent record-breaking rise in global coal prices and natural gas prices, followed by a surge in crude oil prices. Despite the record boom in coal and high prices, supply is not available as required and its impact on the consumer industry has been adverse. Coal shortages have hit power generating units. As a result, there is a possibility of shortage of electricity. Meanwhile, the shortage of coal has also affected the cement industry, cement market sources said. There have also been indications of a recent rise in cement prices due to coal shortages. There have been reports of recent price hikes by cement manufacturers. Cement prices have recently gone up in various states. With the recent end of the second wave of Corona and the easing of lockdowns and now the process of re-opening in various states and cities in the country, the pace of construction has increased. The festive season has also begun. In such an environment, the demand for cement market and industry in the country has also increased. Cement prices in various cities across the country have recently risen to Rs 6-8 per 20 kg and market experts are predicting further rise in prices before Diwali, according to cement industry sources. Coal shortages and rising coal prices have had an impact on the market. In addition to cement, steel-iron prices have also gone up recently. And this has led to new challenges for the construction sector. In many cities, there have been indications that various builders' associations have approached the government and requested the government to mediate the issue and find a solution. Steel prices have gone up by Rs 15,000 to Rs 20,000 per tonne in 12 months. Recently, steel producers have seen a rise in prices. The country's cement production in the first quarter of the current financial year 2021-2 has been recorded at about 3 million tonnes. According to cement industry sources, such production has declined by about 11 to 12 per cent over the previous year. In the financial year 2021-22, the full-year production of cement has increased by about 4 to 5 per cent, but compared to the previous quarter of this year, such production has declined by about 11 to 12 per cent, sources in the cement industry said. In the financial year 2020-21, there are indications that the full-year production of cement will increase by 12 per cent. However, experts were saying that it would still take time for the product to reach the level compared to what was produced before the Corona era. Currently the cost of cement production has gone up. Prices of imported coal and pet-coke have also gone up. Ship fares have gone up and there has been a shortage of containers. And it has affected the price and supply of imported coal. According to sources in the South Indian Cement Manufacturers Association, this has had an impact on cement production. The production cost of cement has gone up by about Rs 20 per quintal, the sources said. The sources added that despite the high price of coal, the supply of coal is not getting as expected.

Cement prices have risen and prices are still likely to rise. Coal prices have risen significantly in the last four months. The price of imported coal, which was hovering around ૪૮૫ 6 a tonne a few months ago, has soared in the short term to ઉપર 1,100 recently, rising above 1,000. While the construction industry has recently been coming out of the cowardly effect, now a new challenge has come up in the construction sector in the form of cement and steel price hikes. Experts point out that other than non-power producers, coal shortages are likely to continue for a long time as there is a shortage of coal in the country's power generating plants and the supply of coal is being supplied exclusively to power producers out of whatever supply is available. .