Cement Prices Rise in December, But Dealers Concerned About Sustainability Amid Low Demand

Price Increases Across Regions

Cement prices have risen by ₹5 per bag month-on-month in December, reaching ₹342 per bag across India. The rise is largely attributed to price hikes in the eastern and northern regions, despite weak demand. Dealers remain uncertain about whether these increases will last, according to a report by Nomura.

Eastern and Northern Regions See Significant Increases

In the eastern region, prices climbed by ₹16 per bag, while in the north, the increase was ₹13 per bag. The central region saw a more modest rise of ₹2 per bag. Cities like Kolkata and Patna experienced price hikes on December 2, but there are concerns over market absorption. Price hikes in October and November in these regions failed, and dealers remain cautious. Volumes improved in Kolkata during the last week of November, but cities like Raipur and Patna saw a 10% decline compared to last year. Dealers expect demand to recover in January.

Price Trends in the Eastern Region

The average cement price in the eastern region now stands at ₹311 per bag, with Kolkata seeing the highest month-on-month increase. However, prices have fallen by ₹4 per bag over the last quarter.

Concerns in the Northern Region

In the northern region, cement prices have reached ₹363 per bag. Price hikes in Punjab and Rajasthan were ₹10 per bag, while Delhi-NCR saw a ₹20 per bag increase. Dealers worry about weak demand, partly due to a labor shortage and stricter construction regulations related to poor air quality in winter.

Flat Prices in Southern Markets

In southern markets, prices have remained flat due to low construction activity and a slowdown in real estate, particularly in Hyderabad. Dealers here expect stability in prices, as no clear factors are driving them upward.

Western and Central Regions

Muted demand in the western region has kept prices steady, while in the central region, prices have dropped slightly by ₹2 per bag. Overall, the cement sector faces uncertainty, and dealers are waiting for signs of demand recovery.