In the eastern markets, traditionally regarded a weak-price zone, prices have shot up to Rs 155 per bag from Rs 120 per bag in January, much to the relief of cement producers with manufacturing facilities in east Madhya Pradesh and Bihar.

This sudden spurt has occurred despite the fact that the eastern region witnessed little industrial activity in recent months, with probably the sole exception of the ambitious Haldia Petrochemicals project which is set to take off after years of inordinate dealy.

Analysts are also at a loss to explain the sudden price recovery in the eastern markets. "The only plausible explanation for the higher demand is probably that there has been a sudden rise in the fragmented real estate construction," said a cement analyst.

In fact, the average April-May prices in the east werealmost 10 per cent up compared to the corresponding figures last year, and the rise is phenomenal if compared to the other regions. In the south, for example, prices have risen by a paltry 3-4 per cent during the period, while north was slightly better recording a growth of around 6-7 per cent.

The higher prices in the east is particularly surprising since the growth in demand for cement in the last fiscal was lower than the national average of 9.5 per cent. The eastern market registered a demand growth of barely over 8 per cent.

Prices in the southern markets, after dipping to new lows, have started firming up to the previous levels. South, traditionally a cement-deficit zone, had witnessed a severe price depression late last fiscal as prices dipped to a record low of Rs 140-145 from the general level of Rs 180 per bag.

The reverse price movement was a fallout of higher despatches in the region from Larsen & Toubro's new unit, and additional capacities of around 0.9 million tonnes each at India Cementsand Madras Cements. "Prices have now bounced back to the Rs 175-180 levels and seems to have stabilised again," an analyst said.

Hyderabad has, however, been the only centre where cement prices are traditionally lower than the rest of the country. Prices at Hyderabad are ruling at a paltry Rs 130-135 per bag. Limestone deposits are concentrated in the Andhra Pradesh belt which pulls down cement prices far lower than the national average.