Cement sales up 15.42% during FY18

June witnesses lower numbers for south-based players

LAHORE: The cement industry ended fiscal year 2017-18 on a jubilant note, posting yearly growth of 13.84% with domestic consumption increasing by 15.42% and exports inching up by 1.77%.

Domestic consumption stood at 41.15 million tons during FY18, increasing 15.42% from 35.65 million  tons in the previous year, according to data released by the All Pakistan Cement Manufacturers’ Association (APCMA). However, exports grew by only 1.77% from 4.67 million tons in 2016-17 to 4.746 million tons during 2017-18.

However, in the month of June, total cement despatches amounted to 2.979 million tons. Out of this, local despatches in the north were 2.158 million tons against 1.897 million tons in June 2017, reflecting growth of 13.77%. Cement despatches in the southern region amounted to 0.423 million tons against 0.485 million tons in June 2017, showing negative growth of 12.79%.



Exports from north-based mills amounted to 0.183 million tons against 0.223 million tons in June 2017 and from south-based mills they were 0.215 million tons against 0.122 million tons in June 2017.

The industry despatched a total of 45.893 million tons of cement in 2017-18 against 40.315 million tons despatched in 2016-17. This is the highest growth posted by the industry in history.

In fact, the past five years have been positive for the cement industry of Pakistan as annual despatches increased from 33.43 million tons in 2012-13 to 45.89 million tons in 2017-18.



It is worth noting that cement exports have been declining since 2008-09. Even in the first seven months of 2017-18, exports were declining steeply.



The turnaround started in February this year with a growth of 18.41%, followed by massive jumps of 84.9% and 81.39% in March and April and then by 41.88% in May and 15.33% in June 2018.

The industry increased its production capacity by 6.58% during 2017-18 and its capacity utilisation stood at 92.82%, the highest since 1992-93 when its total production capacity was only 8.89 million tons compared with 49.44 million tons in 2017-18.



An APCMA spokesman said that reinvigorated increase in exports is a welcome sign for the industry and the decline in rupee value against dollar is restoring lost competitiveness of the sector in global markets. However, APCMA said that rising input cost, especially coal and fuel prices, are hurting the local industry.

Published in The Express Tribune, July 5^th, 2018.

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