413012020 CCovid-19 impact: Retail demand for cement, steel goes missing amid lockdown | Business Standard News, ‘by continuing to use this ste you consent ta the use of cookies on your device as descrivedin our Cookie @ Policy unless you have disabled them. You can change your Cookie Settings at anytime but part of our Ste will not funetion correctly without ther, Business Seana Upon cnt se neth You are ner: Mame » Companies» News Covid-19 impact: Retail demand for cement, steel goes missing amid lockdown While companies are unable to move material dealers continue o suffer due to absence of any business ven though demands largely absent, cement pies for certain pockets have seen a se hitps:lwwn-business-standard.com/articlefeconomy-poliylcovid-18-impact tall: demand for-cement-stel-goes-missing-amic-ockdown-120042..._ 1/5‘41902020 Covid-19 impact: Retal demand for cement, steel goes missing amid lockdown | Business Standard News Riconenn) ‘Acement dealer in the National Capital Region (NCR) points out ‘hat his snop is shut; he has na cement stock and has not received ovid-19 impact: Cement ‘any orders yet. This isa summation of what ails the cement and companies resume ops with ‘minimal production steel sector - inventories at factories are piling up, dealerships, mandis and warehouses are shut, while some construction sites are starving for raw material Covid-19's impact on ‘demand, supply to ‘undermine cement ‘manufacturers ‘Our silos are almost full with cement,” said an executive froma ‘cement company, while another executive from 2 road Coronavirus impact: Cement anys earoe eee AEIae development comgany complained “Cement and ove supplies dip involures {or projects are badly affected Coeiai acne Industries, including cement and steel manufacturing, were Coronavirus to keep cement Cee allowed to start operations from Monday. Many of these have ether partially started operations or are inthe process of seeking Realsations stl under local level approvals. As mandis, trucks, labour, warehouses and pressure for cement firms dealerships go missing from the value chain, cement and sie asdemand remains muted __‘“°2!Ships Bo missing from the value chain, cement and ise! producers are uncertain of a market forthe resumed production, [ALSO READ: Why the current scenario demands a mid-year economic review on priority “For retall demand to pick up, tis important thatthe Ioha mandis metal markets) in every ct are open, Currently, there sno clearance for these mands” said VR Sharma, managing dlrectoratjindal Steel & Power. The same holds rue for the cement sector, with cement dealers yet to be allowed to open thelr shops. Sharma added, as mandls are shut traders, who stock their material at the manais cannot give dealers or distributors He is hopeful the steel ministry will soon release a notification addressing these concerns, Another executive from one of India's top cement producers added, companies have been unable to move out stack from plants as warehouses are shut, Most compari ios have outsourced thier warehouse facility o a third-party, While companies are unable ta move material dealers continue to sutfer due to absence of any business, Sanjay Ladiwala, executive member with Cement Stockists & Dealers Association, points out that the government on Monday allowed dealers to take and process online orders. He added, however, that the online process s fraught with various issues, Even though demand islargely absent, cement prices for certain pockets have seen arise. Cementin the Telangana market, for instance, increased from Rs 325 a bag effective April to Rs 370 per bag effective ‘May in the nan-trade segment, Industry executives have alsa pointed out twill nat be viable to reduce cement prices below pe-ociciow levels as running factories at lower utilisation will also impact viablty FALLING DEMAND Cement sector utilisation (%) | Steel sector utilisation (%) FY19 70 FY19 Das F20E 65-67 | 20 76 FY21P 56-53 SN) | FY21P 67-70 TT) E-esimoted P- pigectec Source: (RIL ALSO READ: Govt no tolerance’ for attacks medics, proposes tough law Nitin Bhasin head of research. yl Inseituional Be csutes ae Ba) amie capa, does nat hitps ww business-standard.com/articlefeconomy-paliylcovid-18-impact tall: demand tor-cement-stel-goes-missing-amic-ockdown-120042..._ 215413012020 Covid-19 impact: Retail demand for cement, steel goes missing amid lockdown | Business Standard News expect rnpanies to run kilns for the first two weeks post iting of the nationwide locisown. “April and May, both would be vary weak months for cement demand. As the locksiown opens up, fer the first two weeks, they don't need to run the kilns as they wll hve cement in the silos and the already produced clinker, to meet the early days of deman,he said, Inventories atthe factory level are piling Up. Ravinder Reddy, drector- marketing for Bharathi Cements, pags the inventory level from 7 to 15 days varying from plant to plant and cement has a shel life of three months. [Asenior official from Steel Authority of India (SAIL) points out that Aprilis the month when dealers get demand registrations. “This fiscal we all ae still waiting” he said. The officials pointed out some of the large sistrioutors are als facing concerns aver non-mavernent of products from factories, The wattin the case ofthe cement sector may be longer as 40 per cent ofincla's cement demand comes from Individual housing projects, which are currently under lockdown. Industry executives also point out that large infrastructure projects, from where cement demand coulé come in, ae cty-centred, with mast of them in red zones, Some others are focusing on readying ther plants tobe able to supply once demand kicks in. "We are currently preparing to be in a position to supply. Our Infrastructure clents have asked us to keep stock ready so once labour and other concerns are addressed, supply can be made,” said Shailendra Choksey, wiholetime director of) K Lakshmi Cement, last week. Choksey does not expect the cement sector to return to its optimal level of utilization before the third quarter ofthe current financial year. “At the moment most ofthe cement companies willbe having inventories with them, fst as demand comes up from infrastructure and dealers they will tar dispersing the cement and thereafter they wil start real production of dinker and cement” said Mahendra Singhl, president for Cement Manufacturers ‘Association (CMA), Read our full coverage on Coronavirus First Published: Wed, Apri 22 2020, 17:29 ST Easy TY EN RECOMMENDED FOR YOU compels oeeey =] RM) LATEST News ALL [ide Jf chose | Tata Sons to infuse more capital int five frms impacted by coronavirus RiLannounces salary cuts; Mukesh Ambani te forgo entire compensation Lupin gets inspection closure report from USFDA for Pthampur plant hitps ww business-standard.com/articleleconomy-paliylcovid-18-impactztall:demand-tor-cement-stel-goes-missing-amic-ockdown-120042..._ 315413012020 Covid-19 impact: Rtall demand for cement, steel goes missing amid lockdown | Business Standard News MOST POPULAR Ea SHARE COMMENTED RlLannounces salary cuts; Makesh Ambani to forge entre compensation Airports prepare to handle 30% fights in first phase of ‘ops after lockdown, Glaxosmithdline plans sale of $3:7.lion stake in Hindustan Unilever © Covid-19 outbreak: Real estate majors rule out price cuts after lockdown, ovid-19 outbreak: Govt ceases curbs on interstate ‘movement amid lockdown MORE ON MARKETS: QUICK LINKS: Glenmark gets DCGI nod for clinical rials of potential Covid-19 drug More> FINANCIAL X-RAY SPD etait unsecured toans, “gh <105-seling may decline post moratorium (o= Despite rebound, airline stocks to Underperform; investors advised caution (o> Aas Bank 94 results Lender's asset quality worrying for investors sti More> ROWSE STOCK COMPANIES AIBICIDIEIFIGIMINIJIRILIMINI 0 hitps ww business-standard.com/articlefeconomy-paliylcovid-18-impactztall:demand-tor-cement-stel-goes-missing-amic-ockdown-120042..._ 4/5413012020 ‘Covid-19 impact: Retail demand forcement, Al srocemmcrine & cewanves > wwaLrenos steel goes missing amid lockdown | Business Standard News: lelqiaisitiulyiwixiviz sa talsier7isls ‘BROWSE MUTUAL FUNDS ALBICIOLELFIGIMITIJIKILIMINIO. lelaialsitiulyiwixiviz fl vrcomne eo BD) PERSONAL FINANCE Inpex stocks @ sersex Aan ors | Asin Pains | A's Bark | BPC | Be) Ao | Bao France ed | Bap Frsery | hava | Bhar nc | Gp | Calin | De Rey's Lvs | Gener Motors | GML) | asin ns | HOF | HCL Teele | MOFC Bank | Heromotecr | Hind, Uneer | Hindako nds. | Hindustan Peolewn Corpraton | ICI Bark [indian Ol Corporston | and Bank | fogs | TC | WS | Kotak Mah Bank | Latan Toure | MM | Maru Sui | Nese na | NTPC | ONGC | Power Gs Corp | Rear lds | Stee Cement | OX of has I sun Parma. 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