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India, being the second largest cement producer in the world after China with a total capacity of 151.2 Million Tones (MT), has got a huge cement industry. The cement industry in India is dominated by around 20 companies, which account for almost 70% of total cement production in India Industry Background : Industry Background The history of the cement industry in India dates back to the 1889 when a Kolkata-based company started manufacturing cement from Argillaceous. But the industry started getting the organized shape in the 1904, when the cement based on sea-shell as a source of lime stone, was first manufactured in Madras. In 1914, three cement units were established, one each at Porbandar (Kathiawar), Kanti (M.P)and Bundi (Rajastan). By the year 1924, there came into existence ten cement factories in India with an installed capacity of 5.6 lakh tones, but the actual production of cement being half of the installed capacity. 5.For popularizing the use of indigenous cement, the ‘Concrete Association of India’ (CAI) was formed in the year 1927.6. In the year 1930, the Cement Marketing Company of India (CMI) was formed to promote the sale and distribution of cement at the regulated prices.7. The turning point in the Indian Cement Company was the amalgamation of eleven cement companies to form the ‘Associated Cement Companies Limited’ (ACC) in the tear 1936. 8.In the year 1937, Dalmia-Jain group entered the cement field. In the year 1939, the number of cement units in India rose to 21. 9. The first ‘Public Sector Cement Unit’ was established in the year 1938, in the name of Mysore Iron and Steel Works’ at Bhadravati : 5.For popularizing the use of indigenous cement, the ‘Concrete Association of India’ (CAI) was formed in the year 1927.6. In the year 1930, the Cement Marketing Company of India (CMI) was formed to promote the sale and distribution of cement at the regulated prices.7. The turning point in the Indian Cement Company was the amalgamation of eleven cement companies to form the ‘Associated Cement Companies Limited’ (ACC) in the tear 1936. 8.In the year 1937, Dalmia-Jain group entered the cement field. In the year 1939, the number of cement units in India rose to 21. 9. The first ‘Public Sector Cement Unit’ was established in the year 1938, in the name of Mysore Iron and Steel Works’ at Bhadravati Cement Production and Growth : Cement Production and Growth Domestic demand plays a major role in the fast growth of cement industry in India. In fact the domestic demand of cement has surpassed the economic growth rate of India. The cement consumption is expected to rise more than 22% by 2009-10 from 2007-08. In cement consumption, the state of Maharashtra leads the table with 12.18% consumption, followed by Uttar Pradesh. In terms of cement production, Andhra Pradesh leads the list with 14.72% of production, while Rajasthan remains at second position The production of cement in India grew at a rate of 9.1% during 2006-07 against the total production of 147.8 MT in the previous fiscal year. Importance of Cement Industry to Indian Economy : Importance of Cement Industry to Indian Economy Basic ingredient in construction work. Generation of employment . Contribution to national exchequer . Contribution to Indian railway revenues . Helpful in the development of other industries. Enhancement in the national income. Huge export potentialities and quick marketability Classification of Cement : Classification of Cement The cement as we know and use it today, was invented or prepared in the year 1824, by Mr. Joseph Aspdin of England and gave it the name ‘Portland Cement.’ Hydraulic Limes. Natural Cements. Portland Cements . Portland Cements : Portland Cements Portland cements are made of grinding a mixture of limestone and clay matter, burning the mixture at a very high temperature, cooling the resultant product; called 'Clinker', and then grinding the same to an impalpable power. Usually, Portland cements are divided into the following seven classes: Ordinary Portland cement; Moderate Heat Portland cement; Rapid Hardening Cement; Low Heat Portland cement ; Sulphate Resisting Cement; Oil Well Cement; White Cement; The Concept of Capacity Utilization and its Measurement: : The Concept of Capacity Utilization and its Measurement: The 'Utilization of Capacity means the extent to which the capacity has been utilized for production of a particular product or service. Actually, it is a ratio which is usually expressed as a percentage of actual production to the 'Capacity'. The general concept of the capacity utilization . Maybe expressed mathematically as under. capacity Utilization = Actual Production x 100 Installed capacity The Concept of Capacity : The Concept of Capacity The term 'Capacity' originates immediately after a project report for an enterprise or an industrial unit is formulated or finalized. The term capacity is not used only in a single or double meaning, but there are plethoras of terms related directly to the term 'Capacity' . It is used in a number of way’s such as , Installed Capacity. Licensed Capacity . Attainable Capacity . Designed capacity . Rated Capacity . Available Capacity . Measurement of Capacity Utilization : Measurement of Capacity Utilization Extent, to which the capacity has been utilized, is measured according to a formula based on the annual installed capacity and on the annual production of the plant. For the measurement of capacity utilization, the following formula is usually made use of: U = P x 100 IC U = Stands for Percentage Utilization P = Stands for Actual Annual Production IC = Stands for Annual Installed Capacity The Optimum Capacity: Its Concept and Determinations : The Optimum Capacity: Its Concept and Determinations 'Optimum Capacity' has a different meaning from the installed capacity. The Installed Capacity reveals the level of production of a particular plant in the long run mentioning a maximum technical limit beyond which production cannot be increased 'Optimum Capacity' is the maximum production which is subject to some constraints. It is always less than the installed capacity. In a simple sense, optimum capacity is the attainment of the best possible or the maximum possible, after making reasonable allowances for proximate constraints which cannot be avoided altogether. An optimum output is that beyond which a larger output is not possible using the same inputs. Impact of Under-utilization of Capacity in Cement Industry : Impact of Under-utilization of Capacity in Cement Industry To find out the impact of the under-utilization of capacity, it is to be presumed that in the long-run optimum capacity would be closer to the installed capacity . Studying the problem with this aim in view, we find that the capacity utilization would be below the optimum capacity. It is always advisable to find out the impact of the under-utilization of capacity (a) at the plant level; (b) at the inter-industry level; (c) at the national level. Under-utilization of capacity does not merely affect the industry, but adversely affects the economy as a whole and its evil-effects are still more concerning and detrimental when the concerned industry is the basic and key industry of the country, such as the Iron and Steel Industry or the Cement Industry upon which depends the all-round development of the economy. Suggestions for Optimum Utilization of Capacity in Cement Industry : Suggestions for Optimum Utilization of Capacity in Cement Industry The licensed capacity of the cement industry should not be enhanced any more. An enhancement in the installed capacity alone is not going to deliver goods. Installed capacity should be enhanced only up to a limited extent . The optimum level of capacity is expected to be achieved at 90 percent realization of its installed capacity and the National Planning Commission has approved of this concept for all practical purposes. The percentage of levy-cement may be reduced by the Government with a view to providing an added incentive to the industry for increasing the productivity . The individual cement units are permitted to establish their own mini power stations to meet their requirement of power supply. . Priority of the first order that adequate and timely coal supplies be maintained to the industry to ensure the progress uninterrupted . The sick and unviable cement units of the industry be taken over by the Government and merged with those units that are running on sound economic lines You do not have the permission to view this presentation. In order to view it, please contact the author of the presentation.