Infrastructure and housing are expected to drive India’s cement demand in FY17-18. Consumption is forecast to increase five per cent YoY as growth accelerates from 1.2 per cent in FY16-17, according to Business Line.

In FY16-17 output fell to 279.8Mt as demonetisation affected the market and saw sales volumes decrease by nine per cent between November 2016 and March 2017. However, the market picked up in April, bouncing back with a growth of 17 per cent and supported by rising prices as the supply-demand scenario improved.

While cement plants in the north are likely to pass on the rising power, fuel and freight costs, their counterparts in the south are expected to depend on sustained higher prices to maintain profitability, according to ICRA Senior Vice-President, Sabyasachi Majumdar.