Desperate attempts by cement makers to push up prices in Mumbai, the largest market for the commodity, have not quite succeeded. The latest move by all top manufacturers to hike prices last week — by Rs 7 a bag — is learnt to have fallen flat, with manufacturers driving up dispatches to gain the maximum from the post-monsoon pick-up in demand.

Dealers say that the wholesale prices in the trade segment, which had risen by Rs 5 to Rs 161 per bag earlier this week, have again inched back to the earlier levels.

Retail prices per bag, as a result, are currently ruling at around Rs 170. Prices in the non-trade (bulk) segment are ruling at just around Rs 140 per bag.

“There is a downward trend in prices as supplies have shot up in recent weeks. Delays in regulating supplies is having a dampening effect,” said a dealer.

“It’s a situation where every manufacturer wants to benefit from the improvement in demand. While efforts are on to push up prices, manufacturers do not want to lose out on volumes either,” said an analyst.

Says an industry observer, "The demand situation is today much better with fresh orders coming from infrastructure projects.

"However, this is not translating into improved prices as the spurt in supplies have been far exceeding the additional demand.”

The weakening of prices in Mumbai would come as a setback for manufacturers who were planning to step up the momentum to jack up prices — by around Rs 15-20 per bag — over the coming weeks.

Manufacturers, however, say that the weakening is a temporary phase and will get corrected in the coming weeks.

“After all, the demand situation has improved and we are looking at other arrangements, including supply regulation, to ensure that the prices stay at that level,” said an industry official.

“Traditionally, this is the peak season for the industry. Demand has improved and construction activities are going on in full swing. We expect the demand to improve in the coming weeks,” said an industry official.

Last month, industry shipments rose by 7.4 per cent to 8.3m tonnes, up from 7.7m tonnes in the same period last year, while production rose by 7.5 per cent.

Cement dispatches during April-November '01 increased to 66m tonnes, against 62.4m tonnes the previous year, while industry output increased from 62.6m tonnes to 66.1m tonnes during the period.