ACC sees Indian cement market oversupply in 2H

ACC sees Indian cement market oversupply in 2H
Published: 16 March 2009

Business Standard quoted ACC said that the domestic cement market will see oversupply in the second half of 2009.

The Holcim group company said that: "Although cement prices may be reasonably stable, the bunching of fresh capacity, particularly in the 2H of 2009, could cause a supply overhang."

However, overall domestic capacity is 207Mt and an addition of 46Mt is expected in 2009. ACC’s own capacity will rise from the current 22.63Mt to 30.58Mt by 2010.

Industry analysts said that demand will remain better than expected till May to June and so will prices.

ACC’s said that "Across the country, planned capacity additions have started to come on-stream. The additional capacity, coupled with slowing demand will potentially bring down capacity utilisations."

The Cement Manufacturers Association said the industry’s capacity utilization dropped to as low as 86% during the April to January period. It was 93% in the corresponding period in 2008.