Cement makers expect demand recovery ahead of monsoon despite rising input costs

India’s cement industry is preparing for a stronger demand cycle in May after witnessing a relatively weak April due to labour shortages, election-related disruptions and seasonal factors. Cement manufacturers are optimistic that infrastructure activity and real estate construction will improve in the coming weeks ahead of the monsoon season.

Industry experts noted that April demand was affected mainly because migrant labourers, especially from states such as West Bengal, returned to their hometowns to participate in elections. Construction activity across several regions slowed temporarily, impacting cement dispatches and overall market momentum.

Despite the slowdown, early indicators in May are showing signs of recovery. Infrastructure projects and institutional demand are expected to drive higher cement consumption, particularly in urban and industrial regions where government spending and private real estate activity remain strong.

However, the sector continues to face pressure from rising input costs. Cement companies have already implemented price hikes of around Rs 10 to Rs 20 per 50-kg bag across multiple markets to offset increasing expenses linked to petcoke, coal, logistics and packaging materials.

Industry analysts believe further price revisions may be introduced if fuel prices remain elevated in the coming months. Cement producers are also closely monitoring transportation costs and energy prices, which continue to impact profitability.

According to market experts, demand recovery may remain uneven across regions, with trade dealers still maintaining cautious inventory levels. While infrastructure projects are expected to support volumes, companies may continue facing margin pressure due to higher operating costs.

Ambuja Cements Chief Executive Officer Vinod Vaishi recently stated that the cement industry could witness around 5 to 5.5 per cent growth in FY27 despite inflation concerns and uncertainty surrounding the upcoming monsoon season.

The Indian cement sector remains optimistic that improving construction activity and government infrastructure spending will help sustain demand growth through the rest of the financial year.