Cement consumption in Andhra Pradesh, which registered a negative growth in April against a scorching growth of 21 per cent during the previous year, is picking up again, spurring cement prices correspondingly, according to K V Venkataraman, chief executive of AP Cement Manufacturers Association (CMA).
While cement prices in other southern states have already risen by about Rs 10 per bag in the last fifteen days, prices in Andhra Pradesh are likely to firm up by Rs 15 by mid June, Venkataraman said.
While AP Housing Corporation has just started placing orders after a gap of nearly four months, state government orders too have started coming in for canal lining works in Prakasam, Cuddapah and East and West Godavari districts.
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Construction activity which has been severely hit in both Rayalseema and Telangana districts due to water scarcity, are likely to revive with the onset of monsoons, he said, adding that monsoons in these parts of the state are not heavy enough to disrupt construction activity.
With about five lakh houses to be constructed this year in Andhra Pradesh under various
government schemes, the consumption on this account will be substantially higher than the 6 lakh tonne (lt) last year for less than three lakh units constructed.
Venkataraman expects a consumption of over one lakh tonne per month during the next eight months on this housing activity alone.
Last year, all government purchases put together accounted for about 8 lt. Both production and consumption of cement in the state during April this year has fallen sharply.
While in March and April 2000, the production was 18.3 lt and 13.6 lt, respectively, consumption was at 10.2 lt and 7.2 lt. respectively.
These figures include units that are not members of Cement Manufacturers Association.
Production figures for March and April 1999 stood at 15.2 lt and 13.8 lt, respectively, while consumption was at 9.3 lt and 7.4 lt, respectively.
For the year 1999-2000, cement consumption in Andhra Pradesh has increased by a record 21 per cent, whereas in Tamil Nadu and Karnataka, it increased by 12 and 14 per cent, respectively.
But in April this year the pace of growth in consumption came under severe pressure and turned negative, whereas in Tamil Nadu the consumption increased to 6.88 lt (from 6.35 lt in corresponding month of previous year) and in Karnataka too it went up 4.44 lt (from 3.88 lt).