India: new Karnataka plant for JSW Cement

JSW Cement Ltd is considering setting up a 4.3Mta cement plant in Gulbarga, Karnataka. The company's ownership of land in the limestone-rich region is quoted as one of the key advantages in building a new plant in Karnataka, according to SS Sandhu, associate vice-president of JSW Cement. A further advantage relates to Gulbarga's ideal location to supply the Maharashtra and Gujarat cement markets.

Moreover, since its sister company JSW Steel produces slag, JSW Cement could manufacture slag cement, though limestone would be a critical raw material in this additional output.

The company is optimistic about demand revival in the south, as the economic activity picks up in Andhra Pradesh and Telangana, said SS Sandhu.

JSW Cement has a cement plant in Kurnool, Andhra Pradesh, with 4.8Mta capacity and a smaller plant with 0.6Mta capacity in Bellary, Karnataka. Besides, it had recently taken over a 1Mta capacity plant in Dolvi, Maharashtra. At present, JSW Cement has a group capacity to produce 6.4Mta of cement.

Asked about the economic slowdown, Mr Sandhu conceded that there was “negative growth” in construction the south, but “stability” has returned. Many projects are expected to come up in the near future in Andhra Pradesh and Telangana. The new Andhra capital planned in Vijayawada would also spur building activity, he added. The company expects a pick-up in demand will drive up capacity utilisation to 75 per cent by the end of the current fiscal from 55-60 per cent now.

In view of the shortage of river sand, slag sand is being increasingly used as an alternative to make cements, he added. However, the share of retail sales of slag sand is less as it is mostly used by cement makers.