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No chance for reducing cement price
No chance for reducing cement price, Justifying the cement price hike, a group of Cement manufactures from Andhra Pradesh and Telangana have categorically refused to reduce the price, which is now hovering between Rs 335/a 50 kg bag.
Cement producers from AP, T say last 3 years industry was accumulated losses, it cannot suffer anymore
Hyderabad: Justifying the cement price hike, a group of Cement manufactures from Andhra Pradesh and Telangana have categorically refused to reduce the price, which is now hovering between Rs 335/a 50 kg bag.
Representing a group of cement manufacturers from both the states, Dr S Anand Reddy, Joint Managing Director of Sagar Cements Ltd said, “For the last three years we are incurring losses…we have no capacity to suffer one more year…No chance for reducing the price, now.”
He further said that there is no room for reducing the cement price as the industry has accumulated huge losses resulting in closure of units.
Surprisingly, the cement makers claim that due to strong governments at centre and states, there is every possibility to revive construction activity besides major infrastructure projects are expected to commence works. “We see demand for cement will increase and even the price will shoot up to Rs 400/ a bag in the coming months,” they pointed out.
There was low demand in the last three years due to Telangana agitation, lot more companies have reduced production and even failed repaying the loans turning the units into NPAs, and some have entered BIFR net, said S Sambasiva Rao, Executive Director, My Home Industries.
According to him, the prices of all raw materials including coal, diesel, transport etc have gone up substantially in the last three years, thus forcing the cement makers to raise the prices.
On capacities, Reddy said that the total production capacity in the united Andhra Pradesh is about 80 million tones. However, both the states together has about 22 million tones of consumption, hence, industry exports the remaining production to neighbouring states including Tamil Nadu, Karnataka, Maharashtra and Orissa, he added.
Cement industry is blamed for cartelization and hiking cement prices unilaterally by over 50 per cent in the last one month. While industry is looking for increased demand as the stable governments will take up infrastructure project in a big way. Meanwhile, the builders in both the state have been observing cement purchase holiday for the last three weeks.
