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Cement Industry rebounds as exports rise

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News Desk |

Despite two months of sluggish growth, the cement industry has come around with more vigorous levels of domestic consumption for September of 2018 in contrast to September of last year. A sustained increase in exports despite a slight reshuffling has also added 18.9% in value to the cement sector.

A spokesman from the All Pakistan Cement Manufacturers Association (APCMA) mentioned the 3.806 million tons of cement sales for this month as compared to 3.201 million tons in September 2017. Similarly, 2.45 million tons in cement sales took place this month in the northern regions, 3.45% higher from 2.369 million tons in September 2017.

Exports as well from the north fell by 21.58% to 0.747 million tons in contrast to 0.953 million tons the previous year for the same quarter.

Although sales in the southern region are a mere 0.641 million tons in comparison, they were up by 48.81% this month as opposed to 0.431 million tons last year. Cement exports totaled 0.294 million tons in September 2018 from the North displaying a decreased trend by 4.69% against 0.308 million tons exported last year in September.

Shipments from the south were up by 350.92% from 0.093 million tons the previous September to 0.421 million tons this year. Although there has been considerable growth, the first quarter of the current fiscal year ended on a modest note for the cement industry.

Read more: Rise in Exports reinvigorate Pakistan’s Cement Industry

In the third quarter of 2018, cement production plants sold a total of 10.813 million tons, a moderate increase of 4.48% over the 10.349 million tons churned out in the third quarter of 2017. This rise was notably smaller when compared to the higher growth trends the industry has maintained over the previous five years.

According to data released by the APCMA, the fiscal year of 2018-19 did start on a positive note in terms of domestic consumption as well as shipments. The first quarterly growth numbers did not correspond with the expansion in production capacity of the industry that took place this year.

Exports from the south also registered a massive rise of 212.13% surpassing 1.044 million tons compared to the 0.334 million tons during the Jul-Sept quarter of 2017.

Instead of the usual 87% capacity utilized by the industry in the past 3 years, this year’s first quarter saw only a 79.75% capacity usage. In conclusion, the APCMA attributed this slowing down of economic and construction activities to the 2018 election campaigns where most workers had to return to their respective hometowns for casting their votes.

The spokesperson for the APCMA pointed out that the greater cement production capacity of the country lies in the northern regions. “These mills remained under immense pressure in the first quarter,” he added.

Read more: Pakistan Cement Industry set to boost capacity with new projects

The northern regions alone produced a sum total of 7.151 million tons of cement during the first three months of 2018 clocked at a 4.94% decrease in sales against the 7.523 million tons sold in the first quarter of 2017.

Exports as well from the north fell by 21.58% to 0.747 million tons in contrast to 0.953 million tons the previous year for the same quarter. Comparatively cement mills in the south had taken the front seat driven by a rise of 21.51% in domestic consumption from 1.539 million tons in the first quarter of 2017 to 1.870 million tons this year.

Read more: Experts predict Pakistan Cement exports to rise

Exports from the south also registered a massive rise of 212.13% surpassing 1.044 million tons compared to the 0.334 million tons during the Jul-Sept quarter of 2017. The spokesperson highlighted the higher tax policies on cement in the south and in order to further exploit this growing trend, urged the government to push for more concrete measures in terms of tax reduction.


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