Cement units performed better in May 1997 with production, capacity utilisation and despatches increasing sharply over not only the previous month but also the previous year.
Data provided by the Centre for Monitoring Indian Economy (CMIE), shows that in May 1997, production was up 17 per cent and despatches by 18.5 per cent over May 1996. Capacity utilisation of large cement units was also up at 93 per cent against 73 per cent last year.
This marks a sharp improvement from not only the previous year but also the previous month, April, when production had dipped five per cent and despatches 4.8 per cent.
Top industry sources say the higher despatches could be due to pre-monsoon demand.
The rise in prices during this period also corroborates this explanation.
Retail prices in four major metros shows that cement prices after slackening in April rose sharply in May before stagnating in June. In Delhi for instance, cement prices per 50 kg bag, fell from Rs 140 in March first week to Rs 139 in April first week before rising to Rs 145 in May. In June, however prices slid to Rs 137.
In other cities also prices rose in May and remained steady throughout June. In Mumbai, cement prices rose from Rs 157 in March to Rs 170 in June, while in Chennai, prices touched Rs 170 from Rs 160.
Cement despatches rose to 69.95 lakh tonnes in May from 55.33 lakh tonnes in April. Last year, they were 59.04 lakh tonnes in May and 58.10 lakh tonnes in April. Production touched 60.40 lakh tonnes in April 1997 and 75.80 lakh tonnes in May. For the same period last year, there were 63.58 lakh tonnes and 64.55 lakh tonnes.
The news must come as a ray of hope for the beleaguered cement industry, which suffered heavily in 1996-97.
Many major cement companies reported poor performances.
