Cement sales grow 5% in August

Stand at 3.52m tons against 3.35m tons in August 2019

LAHORE:

The cement sector posted a sales growth of 5.04% in August 2020 compared to the corresponding month of previous year, which pointed towards a recovery in the national economy.

According to data released by the All Pakistan Cement Manufacturers Association (APCMA) on Friday, cement sales were recorded at 3.52 million tons in August 2020 against 3.35 million tons in August 2019.

However, on a month-on-month basis, cement sales fell a substantial 27% compared to sales of 4.84 million tons in July 2020.

Data revealed that local cement demand increased 4.84% to 2.79 million tons in August 2020. The industry had managed to sell 2.67 million tons in the domestic market in August 2019.

On the other hand, cement exports registered a modest rise of 5.82%, increasing from 0.69 million tons in August 2019 to 0.73 million tons last month.

Cement mills based in the north dispatched 2.49 million tons to the domestic market in August 2020 compared to 2.35 million tons in August 2019, an increase of 6.26%. Exports from the northern region came in at 0.21 million tons, which was 8.45% higher than exports of 0.2 million tons in the same month last year.

Cement mills based in the southern region continued to record a decline in the domestic market as local sales stood at 0.3 million tons in August 2020 against 0.32 million tons in August 2019, a fall of 5.6%.

Exports from the southern region registered an uptick of 4.78% to 0.52 million tons in August 2020. This region had managed to ship 0.49 million tons abroad in August last year.

Overall, cement dispatches in the first two months (July-August) of the current fiscal year increased 21.78% to 8.36 million tons as opposed to 6.86 million tons in the corresponding period of 2019. Domestic sales during the two months stood at 6.7 million tons compared to 5.64 million tons in the corresponding period of previous fiscal year, an increase of 19.53%.

Exports during the period under review registered an increase of 32.2%, rising from 1.22 million tons in July-August 2019 to 1.61 million tons in July-August 2020.

A spokesperson for the APCMA was of the view that the increase in cement sales was a one-off phenomenon.

"The industry was expecting the momentum to continue from July, however, an appreciable decline in domestic uptake and exports is disappointing," he added. "The decline came mainly due to heavy rains, Eidul Azha and Ashura holidays." He added that the industry was unable to understand why the impact of the construction package was not yet felt in the south.

He appealed to the government to minimise duties and taxes on the cement sector in order to increase cement consumption. He also questioned why the cement sector and captive power were excluded from the subsidised power and gas, which was available to the five major export-oriented sectors.

Published in The Express Tribune, September 5^th, 2020.

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