Cement sector tendencies: Volume rises 9% in May, average bag price up 8%, industry output seen at 480 MT in FY26

India’s cement industry skilled sturdy development in May 2025, with volumes rising by 9% and costs rising by 8%. ICRA tasks continued quantity development of 6-7% for FY26, pushed by housing and infrastructure demand. Improved working margins are anticipated because of price hikes and favorable price atmosphere, with decrease coal and regular diesel costs.

India’s cement industry registered a 9% year-on-year development in quantity in May 2025, reaching 39.6 million metric tonnes (MT), whereas average cement costs rose 8% to Rs 360 per 50-kg bag, in accordance with a report by ranking company ICRA.The report famous that cement costs in the primary two months of FY26 averaged Rs 360 per bag, up 7% over the identical interval final yr. This comes after a 7% decline in FY25, the place average costs had fallen to Rs 340 per bag.Volume development additionally remained regular. In April and May 2025, cumulative cement dispatches rose 8% YoY to 78.7 million MT, up from 6.3% development in FY25 when annual dispatches stood at 453 million MT, PTI reported.“ICRA expects cement volumes to grow by 6-7% YoY to 480-485 million MT in FY26, supported by sustained demand from housing and infrastructure sectors,” the report acknowledged.Operating margins for ICRA’s pattern set of corporations are additionally anticipated to enhance by 80–150 foundation factors to 16.3–17.0% in FY26, largely pushed by price hikes and a beneficial price atmosphere. Coal and petcoke costs remained decrease in June, and diesel costs held regular.“Coal prices in June 2025 were down 19% YoY to $100/MT, while petcoke prices dropped 2% YoY to Rs 10,880/MT. Diesel prices remained unchanged at Rs 88/litre,” the report stated.In Q1 FY26, coal costs had been 6% decrease YoY, petcoke was up 1%, and diesel continued to remain flat.According to the Cement Manufacturers’ Association (CMA), India’s complete put in cement capability stands at 690 MT.