Normal monsoon comes as welcome news to Indian producers

Normal monsoon comes as welcome news to Indian producers
Published: 03 May 2011

Indian cement manufacturers, which are facing cost and over capacity pressures, have welcomed the Meteorological Department’s initial forecast of a normal monsoon this year which should allow the country to once again harvest bumper food and commercial crops.

As cement producers are now experiencing better demand in the countryside in the wake of an all-time high in food grain production of 235.88Mt in the 2010-11 crop year, a follow-on good harvest will give a help drive demand for the construction of houses in rural and semi-urban centres.


At the same time, the UPA government’s redemption of pledge to build 10 million houses under the Rajiv Awas Yojana for the slum population will generate incremental demand for cement. The housing sector accounts for nearly half the cement use here and therefore, cement producers will want the government to initiate action to clear the backlog of a conservatively estimated 25 million houses.