ACC to import cement from Bangladesh

Cement major ACC is planning to import cement from the operations of Holcim Bangladesh, its associate company, to meet the demand surge next season.

Post-monsoon, ACC expects an increase in the demand for cement in the eastern region by 8-9 per cent.

Romit Budhiraja, eastern India head for ACC said, Holcim Bangladesh has three plants in Bangladesh and the nearest plant is only 40km from the Tripura border."This makes transportation through land economically and logistically more viable, he added.

Holcim Bangladesh currently exports cement through the Tripura route to cater to the demands in the north eastern region adjoining Guwahati. Holcim holds over 41 per cent stake in ACC currently.

The imports would also help to keep prices in check, which are expected to hit the roof in the coming season. Currently, the price of cement is lower in the eastern region compared to prices in the south, where it is hovering at Rs 240 per 50 kg bag. This is attributed to the lower demands in the region owing to monsoons.

Last month the company despatched 3.24 lakh tons in the eastern region which is 17 per cent of the market. It is normally above four lakh tons per month, said company sources.

Owing to the monsoons and flooding in various parts, there has been a dip in the demand for cement in the region by 20-25 per cent, said company sources. The dip is even higher in Orissa, which is traditionally flood-prone, around 30-35 per cent. The demand for cement in the country lessens by an average 15 per cent every year during monsoons, which is why most of the cement majors go for a temporary shut down of the plants for maintenance and de-bottlenecking of operations, so that they can gear up for the coming months, explained industry experts.

August historically the lowest month in terms of demand and despatch. The company had despatched 22 lac tons putting together the months of April, May and June following which there was a dip. In the coming months demand is again expected to go up by 8 to 9 per cent.

The de-bottlenecking work is complete in all the plants, informed company sources. The ACC board has cleared the decision of adding capacity to its Bargah operations, taking it up to 2.25 million tons per year from a present 0.96 million tons.

ACC is also banking on the infrastructure and manufacturing projects on the anvil, in West Bengal. Some of the major ones include JSW Steel's 10 million tonne steel plant, Bhushan's two million tonne, Jai Balaji's upcoming plant and a host of power projects.

Together with the real estate sector clocking in a growth of 30-40 per cent year-on-year, cement sales are likely to surge. "The surge in real estate projects is not only confined to Kolkata but also in tier-II cities like Guwahati, Asansol, Siliguri, Durgapur, which can be prospective markets for the company," said Budhiraja.

ACC has 12 cement manufacturing units in India, of which five are in the eastern region. The company has produced and despatched 1.64 million tons last month overall, which is higher than the corresponding month last year when the net despatch from all operations stood at 1.43 million tons.