Mumbai, March 14: Major cement manufacturers are under pressure to reduce prices following low off-takes and the threat of small companies selling cement at lower prices in Mumbai, the country's largest cement market. According to industry sources, the Cement Manufacturers' Association (CMA), the apex body of cement makers, is reviewing the price situation on a regular basis. Leading cement companies have been under pressure following the decision in the Union Budget to reduce the customs duty on cement imports by 10 per cent.Dealers said smaller companies like Jaypee Rewa and Koromondal Cement are supplying cement at lower prices to the Mumbai market. The companies sell at wholesale prices in the range of Rs 160-165 per bag while the cement majors sell at around Rs 184 per bag.
Besides, the builders lobby which has decided to import cement is expected to add to the woes of domestic cement manufacturers. The president of Maharashtra Chamber of Housing Industry (MHCI) Mr Rajni Ajmera said MHCI has already placed orders for the first consignment of cement from Korea and some other countries. It is likely to arrive in a couple of days, he says.
Cement will be imported from these countries at the rate of Rs 140 to Rs 150 per bag, he said. "It will be cheaper as well as of better quality."
Mr Ajmera was hopeful that the cement price would fall by about Rs 10 per bag in the Mumbai market. Prominent builder Mr Niranjan Hiranandani added that the change in the import duty structure would make cement imports an attractive proposal. Test consignments had already been ordered. Most of the builders would prefer imports as its price would be in the range of Rs 150 to Rs 155 per bag, he said.
To add to the pressure, the builders lobby has decided to continue with their boycott of Grasim and Ambuja Cement. Larsen & Toubro, Gujarat Ambuja and Grasim are the major players in the Mumbai market.
Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.
