News Analysis |
According to the International Cement Review, experts are eyeing an increase in exports of cement from Pakistan during the outgoing FY18. The country recorded its highest growth of cement exports during 2008-10, when, it hovered around 10.75Mt. Of late, exports have started to drift and reached at 4.66Mt in 2016-17 and 3.9Mt in 10 months of FY18.
According to a research house report, cement exports are expected to post stellar growth of more than 37 percent YoY in May, due to addition of new production plants of Lucky Cement and Attock Cement Pakistan (ACPL). “We expect export dispatches to remain over 400,000t during May,”
Nabeel Khursheed, an analyst at Topline Securities said, “Higher exports from Lucky and ACPL’s new cement lines in south region, which came online in December 2017 and January 2018, continue to support this growth as sea exports are expected to settle over 200,000t, up by more than 100 per cent YoY (in May).”
Trade activities between Pakistan and India have slowed down in current fiscal year of 2017-18, as the bilateral trade between the two rival nations has dropped to $1.25 billion from $2.4 billion of five years ago in 2013.
According to a report from Attock Cement Pakistan Ltd (ACPL), exports are bound to increase from Pakistan due to recent environmental issues in larger economies, which have opened a window of opportunity for Pakistani clinker in the tightly-controlled markets of west Africa, Bangladesh and Kenya, besides serious enquiries are also coming from east Asia. Pakistan exported 2.43Mt of cement during FY15-16 to Afghanistan, which fell to 1.76Mt in FY2016-17. While Afghanistan remains the biggest export market for Pakistan producers, this translates into a fall of 28 per cent.
However, the negative trend would turn into a positive one as the country already exported 1.65Mt of cement to Afghanistan during the first 10 months of the FY17-18. The peak export was 4.72Mt in 2010-11, since then exports have dwindled. However, it faces competition in the form of Iranian cement and an increase in Afghanistan’s capacity.
Cement is also a Major Export to Pakistan’s Eastern Neighbor India
At the time when there is a lot of tension in the Indo-Pak relations, Pakistani cement continues to be used in the construction works ranging from domestic, commercial and making of bricks. Harjeet Singh, a brick kiln owner from Ludhiana, said that there are two types of bricks, one that are made from gypsum and the other that is made from cement. In India, he said that fly ash is used in making cement and in Pakistan, the stones are used and this makes it stronger. However, he said that there were certain weak points also as the Pakistan cement required more water as compared to the Indian cement.
The country recorded its highest growth of cement exports during 2008-10, when, it hovered around 10.75Mt. Of late, exports have started to drift and reached at 4.66Mt in 2016-17 and 3.9Mt in 10 months of FY18.
Nittin Jain, a hardware showroom owner said that the cement was not used for small work but was rather used in bulk and the reason he said was that they order Pakistani cement which arrives from Amritsar. Whenever they have a big order only then they order this cement and supply it to the clients. “There are people who have stocks and provide small orders but we deal differently and only deal in bulk orders. There is a demand for the cement as people have this notion that Pakistan cement is cheaper,” he added.
However, Trade activities between Pakistan and India have slowed down in current fiscal year of 2017-18, as the bilateral trade between the two rival nations has dropped to $1.25 billion from $2.4 billion of five years ago in 2013.
Sources in trade and industry said that Pakistan and India are presently doing a total bilateral trade of around $5 billion annually most of which is done via Dubai, besides unofficial trade across the Line of Control (LoC) on Srinagar-Muzaffarabad Road which is not documented.