Steep hike in cement prices in Telangana, Andhra Pradesh

In a New Year shock, cement manufacturers have rolled out a price hike.

The price of cement per bag of 50 kg is now in the range of ₹330 to ₹340 in Hyderabad, while in Telangana and Andhra Pradesh it is slightly lower at ₹310-₹340.

According to Bharat, Manager of Maruti Traders, a major cement dealer here, the increase in price was in the range of ₹50-80 compared with prices prevailing last month.

Earlier, the price in Hyderabad was ₹30-40 lower than the other places in Telangana and Andhra Pradesh, but now it is almost the same, he told BusinessLine on Tuesday.

This was the steepest hike after October 2014.

The average prices went up by ₹20 a bag and stood at ₹320 against ₹300 a bag in the year-ago period. Later, it fell and shot up again now.

The price of the commodity in Tamil Nadu is in the range of ₹355-390 per bag, while in Kerala it is between ₹370 and ₹400 per bag, according to available information.

The price hike, however, is not supported by any increase in demand.

Enquiries with various cement dealers, however, revealed that there has not been any increase in demand and in Hyderabad alone, it had actually dipped.

The industry, however, has a different version.

“The cement price in the two States is still lower than the prices in other southern States. This is a natural price cycle as construction activity is expected to pick up as we move towards the summer,’’ said a top executive of a Hyderabad-based cement company.

Though the cement makers are optimistic about a stable political environment and a possible spurt in the Government construction activity, it still did not happen.

In addition, the present overcapacity and lower utilisation levels at about 55-60 per cent may offset the positive developments, if any.