Cement prices have dropped by Rs 10-15 a bag in Andhra Pradesh, thanks to subdued demand.
Cement is sold at Rs 275-295/bag while the price was between Rs 280 and Rs 300 during October-November, shows a survey of retail outlets here.
“The price has come down primarily due to dip in demand contrary to industry expectations of a surge in demand,'' Mr S.V.S. Shetty, Chief Executive Officer, Anjani Portland Cement Ltd, told
According to industry data, cement demand in State was down by 10-12 per cent compared with October-November last year. It is now in the range of 15-15.5 lakh tonnes a month.
The demand from the State Government, which accounted for 20-25 per cent of supplies in the last few years has virtually dried up, say industry experts. Major programmes like the Jalayagnam (irrigation schemes) and Indiramma Housing scheme pushed by the Y.S. Rajasekhara Reddy Government are limping now, resulting in a drastic fall in cement uptake.
“The residential construction too did not pick up due to political uncertainty. Things may improve going forward,” said Mr Shetty.
According to a senior functionary of a listed cement company who did not want to be identified, the dip in price is going to make things worse for the companies.
“We need to find out a way to keep the price at least at the existing level,'' he said. About three cement plants were also commissioned recently in the State adding up to the surplus in the market.
“The price of some brands like Priya Cement was decreased due to a panic about lack of demand. This had a spiralling effect on price of other brands too,'' a major retailer here said.