Penden Cement: rising demand from India

Penden Cement: rising demand from India
Published: 05 July 2006

Demand for cement has increased and sufficient orders are at hand for the coming months but the monsoon which floods the plains in India and block roads in Bhutan is, as in the past, a thing to worry about, say officials of the Penden Cement Authority Limited in Gomtu.

The sufficient orders come mostly from the National Hydroelectric Power Corporation (NHPC) in India, which has two major projects in Sikkim and West Bengal with a quarterly demand of about 60,000t to 70,000t each.

Penden officials said that usually, at the time of the year, demand dipped but it was not the case this year. However, because of problems faced at the plant, cement supply in June dropped to 24,050t, failing to beat last year’s supply of 35,519t for the same period.

“We were trying to meet the needs of both Bhutanese and Indian market but since we had problems at the plant, we had to supply to the different markets on alternate basis,” said senior marketing general manager, Sonam Rinchen.

So far, this year, Penden has supplied 231,663t, an increase of about 34,368t compared with that of last year for the same period.

Beginning January itself the demand was more compared with last year. The month saw an increase of about 15,000t with an overall supply of 38,207t. The rest of the months, except for June, also saw substantial increase in the supply of cement.

The domestic demand, however, decreased with Tala hydropower project nearing completion. The demand had dipped from about 116,398t last year to 79,732t for the time frame January to June.

“Supply to Tala is very small, about 1000 tonnes in a month, and constitutes a small percentage of the total domestic demand,” said Sonam Rinchen, adding that 90 per cent of the supply within Bhutan were to the domestic market. “Distribution within the domestic market has improved especially after opening three depots in Phuentsholing, Samdrup Jongkhar, and Gelephu,” he said.

Supply to India on the other hand had increased to 151,731t from 80,902t last year. From the 495,000t cement produced in a year about 300,000t is expected to be exported to India.

Contractors working on major Indian projects like the highway construction in Assam and Bengal have put in requirements of about 70,000t of ordinary portland cement (OPC), Penden officials said. “But since we produce only 9,000t of OPC in a month and it caters to the needs of our regulars like the NHPC, the local market in Gomtu, Tala and the domestic market, we cannot make commitments to them,” said Sonam Rinchen.

The overall demand was about 1700t a day while Penden supplied about 1650.