Some cement producers are shifting back to coal from petroleum coke (petcoke) to meet their fuel requirements following the Supreme Court’s recent ban on petcoke use. Currently, the apex court has restricted use of petcoke in Rajasthan, Uttar Pradesh and Haryana to curb pollution in the National Capital Region. But chances of a ban across the country look bright. Though extremely polluting, better quality and favourable cost compared to coal drove cement companies towards petcoke. Though companies have customized their plants, making them flexible to either use petcoke or substitute it with coal, there are challenges on the procurement front for domestic coal. Amid worries of a nationwide petcoke ban and the urgency to switch over to coal, cement companies are staring at earnings downgrades, unless they succeed in passing on the cost hikes through higher prices.

(Live Mint)