Cement is a typically cyclical sector that has weathered many an economic storm. And with the world reeling under the Covid-19, everyone is waiting and watching how the sector will react. India is the second largest producer of cement in the world and the second largest consumer (next to China in bo...
Cement is a typically cyclical sector that has weathered many an economic storm. And with the world reeling under the Covid-19, everyone is waiting and watching how the sector will react. India is the second largest producer of cement in the world and the second largest consumer (next to China in both cases). The sector plays a significant part in the growth story of Indian economy, providing employment to over a million people, directly or indirectly. And over the past few years, it has witnessed a lot of consolidation: Today, the top 20 cement companies account for almost 70% of the total cement production in the country.
The long term growth prospects for the sector are strong, considering India鈥檚 focus on infrastructure development, rapid urbanisation and rural housing.
In terms of total cement demand, housing takes the lion鈥檚 share:
Rural housing contributes 30%
Urban housing 25%
Low-cost housing 12%
Infrastructure 22%
Other commercial use 11%
FIRST Construction Council in association with Indian Cement Review organised the 11th Cement Expo Plus Online on March 17. The virtual event involved the 6th Indian Cement Review Conference 2021 that focused on three sessions:
Will cement demand grow post the pandemic?Opportunities for automation and digital transformationUsing municipal solid waste as fuel in the kiln
The conference was followed by the 4th Indian Cement Review Awards 2021 that will recognise and reward India鈥檚 Fastest Growing Cement companies.
Chief Guest Durga Shanker Mishra, Secretary, Ministry of Housing & Urban Affairs, Government of India, sharing his message with the industry, said, 鈥淐an we make everything Atmanirbhar? With Make in India, we should not only have the technology, but make all our requirements here. Create something that is sustainable in terms of the environment and wider acceptability at all levels. And, ensure efficient utilisation of resources. Several activities are going to come up towards reviving the industry and bringing the Pride of India before the global community 鈥� decisively in a time bound manner with the best quality.鈥漈o read and view event video, click here.
Pratap Padode, Founder & President, FIRST Construction Council, added in his welcome address, 鈥淭he domestic cement production has fallen by 16.6% during the 10-month period for the financial year 2021. Last year, during the same period, we saw a 1% growth, and the year previous to that, we saw a 13.9% growth. Yes, cement production has been falling, which could indicate that the pent up demand has already been exhausted.鈥�
Padode added that the cement industry in India has been growing conscious in its approach towards emission reduction by implementing new technologies to improve productivity, reduce wastage and emissions that pollute the air. The current scenario of pollution levels that cement manufacturing contributes to makes it critical for cement manufacturers to consider adopting technological advancements towards reduction of emission in cement plants.
The event also witnessed the virtual launch of the 34th Anniversary Collector鈥檚 Edition of Indian Cement Review magazine, which focuses on 鈥榠nnovation in sustainability鈥�.
6th Indian Cement Review Conference 2021
Will cement demand grow post-pandemic?
Cement demand strongly correlates to economic growth. When the pandemic hit and the lockdown began, cement demand also witnessed sharp contraction in line with the economic downturn. However, demand has rebounded strongly Q2 onwards. And this year, the cement volume is estimated to match or reach similar to the FY20 level because of the strong growth witnessed post Q2. Having said that, this panel discussion focussed on demand outcome from near to future term as well as few other important aspects such as cost, capex, and supply scenario, to get a holistic perspective.
The panellists included Rajnish Kapoor, Head-Grey Cement, JK Cement; Mayank D Kamdar, Marketing Director, Lilanand Magnesites; Rishi Fogla, Executive Director, Fogla Corp; and Shyam Asawa, President-Projects, Orient Cement. The discussion was moderated by Nitesh Jain, Director, CRISIL Ratings.
The panel discussion highlighted that post- the initial lockdown, demand did come from the rural areas as well as from projects that were at more than 50% of completion stage. Covid has helped in accelerating the speed at which technology could have come into, especially related to AI or IoT. By end of the fiscal year, the industry would have caught up and the companies are expected to be somewhere close to where they were last year. In 2022, the expected growth is roughly 18-20% in south and west of India. Along with government projects, several industrial projects have also been kicked off. FDI funds are also coming in, further improving investment. And, there is going to be greater demand for products that are easy to use and which are long lasting.
Opportunities for automation and digital transformation
Covid-19 has posed one of the most formidable challenges in recent history. The pandemic has been a wakeup call that all companies need to have plans to deal with disruptions to ensure business continuity. It has also been a watershed moment but the fast track acceleration process for digitalisation throughout the industry. So to remain competitive in an environment as disruptive as this, and to be able to offer highly customised products in small sizes, cost-effective and a sustainable manner, industries need eco-system by highly connected data intensive solutions and services. In short, industries need a digital transformation, and this was the focus of the session on 鈥榦pportunities for automation and digital transformation鈥�.
The panellists included Pawan Mathur, Vice President & Head-Automation, UltraTech; Ashok Kumar Dembla, President & Managing Director, KHD Humboldt Wedag; Shreesh Khadilkar, Consultant; and Arun Attri, Vice President-IT, Wonder Cement. The discussion was moderated by Sandeep Ramprasad, Global Service Product Manager, Cement Industry, ABB.
The panel discussed that even before the Covid scenario, a shift towards digitalisation had started in the cement sector, however at a slower pace. With the key question for companies during the pandemic time being how to communicate with stakeholders, systems were strengthened. Also, questions such as how can companies reduce the power, fuel consumption, improve asset reliability 鈥� with less manpower 鈥� accelerated the ecosystem in the Covid scenario. The only positive impact of Covid was the increased focus on digitalisation. The focus should not always be on maximising the production but on more reliability of the plant. This can be achieved with more sensors, data accumulation and studying the data and ensuring that the plant is continuously running. A proper roadmap should be created by an organisation for digitalisation to be a success. It is important to understand what to apply where 鈥� be it blockchain, data analytics, digital twins. It is important to understand and evaluate what is applicable to the cement industry in the short term and long term. Also, the return on investment (RoI) needs to be calculated.
Using municipal solid waste as fuel in the kiln
MSW utilisation in a resource- and energy-intensive industry such as cement has many important drivers 鈥� few national and few on a global scale. Annually, 8-13 million tonne of mismanaged plastic waste is released to oceans, and research says that 80% of this is contributed from mismanagement of solid waste. Various countries are working under the UN environment programme for an international framework for addressing this issue. Even though we have the most energy-efficient cement plants in the world, when it comes to co-processing, India still has a long way to go in terms of substituting fossil fuels with waste. The cement industry is regarded as a polluting industry because it contributed to almost 5-6% of the GHG emissions. These remarks and more were discussed in the third session on 鈥榰sing municipal solid waste as fuel in the kiln鈥�.
Panellists included Michel Folliet, CEO Co-Founder, Pantheum Solutions; Ulhas Parlikar, Global Consultant, Waste Management, Circular Economy, Policy Advocacy, AFR & Co-Processing; Dr Srikanth Sola, CEO & Co-Founder, Devic Earth; and Dr BN Mohapatra, Director General, NCCBM. The discussion was moderated by Palash Kumar Saha, Research Scientist, SINTEF Building & Infrastructure.
The panel discussed that the cement industry imports major% of its fuel requirement and is eagerly looking for its alternate source of good quality fuel. The generation of MSW is growing by 5% annually. Of the 1.2 billion people in India, 377 million live in urban areas and generate approximately 62 million tonne of MSW annually, which is expected to increase to 165 million tonne by 2031. MSW cannot be directly used for co-processing cement kilns. This can be further processed to make fuel and can be used for co-processing. The Ministry of Housing and Urban Affairs has done detailed mapping for cities within 200 km radius of cement plants, where around 143,379 tonne per day of MSW is generated. MSW is a huge opportunity for the Indian cement industry. However, there are issues while utilising this material. Now if MSW is properly segregated and brought to the level of acceptability, both from sustainability and quality considerations, then there is the real opportunity to exploit this material.
4th Indian Cement Review Awards 2021
The awards recognised and awarded India鈥檚 Fastest Growing Cement Companies across the large, medium and small categories along with the Lifetime Achievement Award.
Lifetime Achievement Award: Ashok Jain
Second Fastest Growing Cement Company鈥揕arge: JK Cement
Third Fastest Growing Cement Company鈥揕arge: Shree Cement
Fastest Growing Cement Company鈥揗edium: JK Lakshmi Cement
Fastest Growing Cement Company鈥揝mall: NCL Industries
Second Fastest Growing Cement Company鈥揝mall: Anjani Portland Cement
Third Fastest Growing Cement Company 鈥揝mall: Deccan Cements
The 11th Cement Expo Plus was enabled by the industry:
Powered by JK Cement
Gold Partner Lilanand Magnesites
Silver Partners The Ramco Cements; and KHD Humboldt Wedag
Associate Partners Devic Earth; and Fogla Corp
Supporting Partners Indian Institution of Bridge Engineers; Ready Mixed Concrete Manufacturers Association; and Indian Society of Structural Engineers
Media Partners: Construction World, Equipment India, and Infrastructure Today.
-Report by Shriyal Sethumadhavan
