Cement prices in western, southern regions to go up

Cement prices for both these regions are likely to increase by an additional Rs 5 per bag due to shortages of rakes needed to transport cement

Cement prices in the western and southern regions are likely to increase by another Rs5 per bag in a week’s time, say dealers as well as analysts. Of late, both these regions have been witnessing a rise in prices riding on the supply shortfall due to transportation hitches, they said.

During the past month, cement prices in both the western and southern regions had gone up by Rs7 to Rs12 per bag. Cement prices across major cities in Gujarat have already increased by Rs5 with effect from Tuesday. “The current cement price is Rs195 per bag; it has increased by Rs5 today. It will remain at this price for the next 15 days,” said an Ahmedabad-based cement dealer.

“In Gujarat, the price of cement in major cities like Ahmedabad, Baroda, Baruch, Mehsana and Surat is expected to increase by Rs5 per bag with effect from 15th December. At present, the average price of cement per bag in Baroda, Surat and Baruch is in the range of Rs195-Rs200 per bag, which will be revised upwards to Rs200-Rs205 per bag,” said Sharekhan Ltd in a research note.

As per the brokerage report, cement prices in the major cities of Maharashtra are also likely to witness an increase of Rs5 by 21st December. Presently, the average price per cement bag in Mumbai is Rs240.

Cement prices in cities like Hyderabad in the southern region are also likely to increase by another Rs5 from Rs140-Rs145 per bag to Rs150 per bag in a week’s time. Currently cement in Hyderabad is priced at Rs140-Rs145 per bag.

In the northern region, cement prices have remained almost unchanged but dealers there expect the price to go up if the logistics problem continues any longer, the report further stated. The current cement price in New Delhi is Rs227 per bag.

Before the recent rise in prices, cement prices all over the country were on a continuous downfall. In a short span of time—between August and October 2009—cement prices had fallen from Rs230 per bag to Rs140 per bag.

The southern region was worst affected by the downfall. The current rise in prices for these two regions is due to a shortage of wagon supply to transport cement to these regions.

Wagons have been diverted to transport foodgrains, which is a priority sector. This recent price correction is expected to be a temporary phenomenon, with prices expected to go down after March 2010.

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    9 years ago


    Vanishing act: FMCG industry buries recession in fairness cream

    Looks-conscious consumers propped up sales of fast-moving consumer goods (FMCG) companies, who in turn rewarded loyalty by not raising prices of fairness, anti-ageing creams, bathing bars and their likes, although input costs have risen in an economy ravaged by drought and then floods

    As the global economic crisis consumed nearly every sphere of business, one industry held out against recession through 2009 by promising to help Indians look fairer, younger and their teeth whiter, kids stronger and taller, and toilets cleaner, reports PTI.

    Looks-conscious consumers propped up sales of FMCG companies, which in turn rewarded loyalty by not raising prices of fairness, anti-ageing creams, bathing bars and their likes, although input costs have risen in an economy ravaged by drought and then floods.

    Instead, they downsized the packaging to balance costs and margins.

    "The sector has coped well with recent challenges and grew by 15% over the last year," says the Federation of Indian Chambers of Commerce and Industry (FICCI). The FMCG market in the country is worth $25 billion (about Rs1,20,000 crore).

    Year 2009 also saw modern retail format stores and aggressive marketing help home-grown FMCG firms wrest market share from leader Hindustan Unilever Ltd (HUL), according to market research firm AC Nielsen.

    HUL's share in the estimated Rs8,000-crore personal care market fell to 44.5% from about half last year, as others like ITC Ltd, Godrej Industries Ltd and Wipro Ltd fought for space in markets like Uttar Pradesh, Bihar and Gujarat with a rural push, says AC Nielsen.

    Mergers and acquisitions (M&As) were few and far between during the year, and Wipro's Rs210 crore acquisition of UK-based Yardley's overseas operations was a highlight.

    As for foods and beverages (F&B), the Indian market proved to be the growth driver for the world's biggest players like Coca-Cola and PepsiCo, even as their US parents grappled with falling sales.

    PepsiCo's optimism in the Indian market was reflected in the global major holding its board meeting in India for the first time this year. The company has stepped up investments by another $100 million, from the $500 million announced last year for the next three years.

    Surging input costs remained a pain area this year for F&B firms in the foods and beverages segment, mainly on account of soaring sugar prices which doubled to almost Rs40 a kg in the national capital in a year. Companies like PepsiCo, Britannia, ITC and Parle seriously mulled increasing prices of products to mitigate the rising costs, but held back.

    Elsewhere, Dabur and Emami completed consolidation and restructuring after their respective acquisitions last year of Fem Care and Zandu Pharmaceuticals.

    While Wipro went premium with Yardley, FMCG companies went in for a big push in rural areas, upbeat on the government's thrust on agriculture and increase in allocation for rural jobs.

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