Cement Industry: Full Outlook for Future

Shree Jung Rodhak Cement is a renowned brand among cement industries in Nepal. It was established in 2004 with the main objective of manufacturing and supplying Portland cement to the local market. It is located at Gaidakot, Nawalparasi which is 200 km west of Kathmandu. The company has been producing high quality cement with its advanced technology and techniques.

In this post, we will discuss about the factors which determine the demand and supply of cement in Nepal.

The cement industry is one of the most developing industries in Nepal. This industry has really been contributing to the national economy of Nepal. Cement is the basic building material that is used for all kinds of construction works. Therefore, its production is highly required in Nepal. As we are heading towards a long term goal of development and modernization, the demand of cement is increasing gradually.

Shree Jung Rodhak Cement Udyog Pvt Ltd (SJRC) established in BS 2040 Ashwin 1st (AD 1984) with a paid up capital of Rs. 5 million with the objective of producing cement and clinker within the country from raw materials available in Nepal rather than importing from other countries for the economic development of Nepal.

The company was promoted by eminent personalities like: Shri Bishwambhar Pyakurel, Dr. Govind Raj Pokhrel, Mr. Barun Kumar Jha, Mr. Balram Upadhyay and Mr. Gyanendra Lal Pradhanang, while Mr. Balram Upadhyey was the first Chairman of this company.

The company has been producing OPC under the brand name ‘SHREE JUNG RODHAK’ since BS 2042 Kartik 18

Cement Industry Outlook: Future of Cement Sector in India

The demand for cement will be the maximum in the infrastructure and real estate sector, followed by housing sector. The demand from this segment is expected to grow to 117 million tones by 2050.

The government’s focus on infrastructure development including construction of roads and highways, combined with the smart cities project will drive the growth of the cement industry in India. The government plans to invest around Rs 6 trillion (US$ 92.2 billion) on expansion of power transmission and distribution networks in rural/semi-urban areas over a five year period beginning 2017. It will also build 80,000 new health sub centers and 1.5 lakh health wellness centers along with 5 lakh farm ponds and 10 lakh compost pits under its Jal Shakti Abhiyan water conservation scheme.

The Union Budget 2018-19 has allocated Rs 5.97 trillion (US$ 92 billion) towards infrastructure spending. The construction sector accounts for more than 70 percent of the overall cement demand in India; consequently, infrastructural developments contribute significantly towards the growth of this sector as well.

The Indian government is likely to increase investment in infrastructure and affordable housing to boost economic growth from 7.1 per cent to 7.5 per cent

Cement industry is one of the basic industries in Nepal. It is also one of the well established and fast growing industries with a great future potential. The major raw materials required for the production of cement are limestone, clay, sandstone, gypsum and pumice. The major raw material, limestone occurs in abundance in Nepal. It is estimated that around 70% of limestone required for cement industry is available in different parts of the country. The other major raw materials are available locally. The Government should facilitate to exploit mineral resource in a competitive market environment.

The present demand for cement in Nepal is estimated to be around 3 million MT per annum and is growing at about 8-10% annually. If the current trend continues; it will reach 4 million MT by 2013 and 6 million MT by 2018. There are several ongoing projects like hydropower development, roads construction and infrastructure development which will further boost up the demand for cement in near future.

For the first time in the last twenty years, Indian cement industry has recorded a negative growth rate of 2.1 per cent during the year 2009-10. The production of cement during 2009-10 was 212.16 million tones (MT) against 216.61 MT in 2008-09. Cement manufacturing capacity is projected to reach 300 million tonnes per annum (MTPA) by 2013, driven by increased demand from infrastructure and housing investment programmes.

This development comes close on the heels of the collapse of the real estate sector in India, which slumped for the first time in more than ten years in 2008-09. Excess capacity, coupled with a sluggish real estate sector and low infrastructure spending, have put downward pressure on prices, resulting in lower profitability for cement companies.

The industry expects an improvement in demand from the second half of 2010-11 as a result of a revival in the economy on account of an increase in public investments and improvement in consumer sentiment. However, with supply expected to outstrip demand for most part of 2010-11, manufacturers are likely to be under pressure due to high interest rates and higher raw material costs.

The cement industry is one of the most competitive and dynamic industries in the world. The demand for cement and concrete is growing at a rapid pace, due to its widespread use in the construction industry. Cement manufacturers are investing heavily in their factories and production capacities. The industry has grown by leaps and bounds and has expanded significantly in the last few years. At present, a large number of domestic and foreign companies are investing heavily in cement production capacity expansion.

The future of cement industry looks promising and profitable. Many companies are entering into mergers and acquisitions to increase their production capacity. In addition, new plants are being set up in various parts of the world, particularly in developing countries such as India, China, Indonesia, Brazil, Argentina and Mexico.

The demand for cement is expected to grow further due to economic growth, urbanization and infrastructure development. However, there are some factors that could hamper the growth of the cement industry in the near term. These include rising energy costs, declining interest rates and increasing competition among global players who want to tap the huge potential of emerging markets such as China, India and Brazil.

As a most common and basic construction material, cement has been used in different forms worldwide for centuries. The early form of cement is lime mortar, which dates the use of cement back to some thousand years.