Cement Industry: Limestone and future outlook

December 10, 2021

India is the second largest producer as well as consumer of Cement. Limestone is the principal raw material required for cement manufacturing. Fortunately, India is endowed with diverse mineral wealth, including surplus resources of limestone. Over the past decade, barring the pandemic affected period, the requirement of limestone in India has exponentially grown owing to the growth and expansion of the cement sector, which alone accounts for almost 95% of the Country’s total limestone consumption.

Figure illustrates the future outlook of limestone requirements by the Indian Cement Industry estimated at a normative growth rate of 7% from 2020-21 onwards. The limestone requirement is proportionate to the estimated cement production as according to the general rule of thumb each tonne of cement requires approximately 1.1 tonnes of cement grade limestone.

Estimated growth of limestone requirement by the Indian Cement Industry
Source: Office of the Economic Adviser, DPIIT, Ministry of Commerce & Industry, Government of India; CMA estimates based on general assumptions.

A closer look at the above chart indicates that the limestone requirement can be expected to double over the next 10 years. By 2030, the cumulative demand for limestone would be around 4,664 million tonnes (MT). As of 2015 assessment, India’s total resources of limestone has been estimated at 2,03,224 MT, which indicates that India is comfortably placed to cater to the domestic needs for many more decades. There is however, an uncertainty with timely supplies of limestone mineral as only 8,558 MT of cement grade limestone resource is proved as mineable reserve to date. Figure illustrates the latest position of resource to reserve stock of limestone mineral in India.

Limestone Resource and Reserve stock status in India
Source: Indian Bureau of Mines (IBM), Indian Mineral Yearbook 2018, Available at: http://ibm.nic.in/writereaddata/files/08062019095529Limestone_2018.pdf; accessed November 6, 2021

This calls for fast track exploration of limestone mineral; expeditious concession of mining rights for limestone; pre- embedded statutory clearances with the auction of limestone mineral blocks; and promotion of a circular economy to reduce the growing requirement of limestone by way of utilising alternative materials.