Cement sales decrease 16%

LAHORE:

Cement sales contracted 15.85% to 3.32 million tons in May 2022 compared to sales of 3.94 million tons in the same month of previous year.

According to data released by the All Pakistan Cement Manufacturers Association, domestic cement sales of the industry stood at 3.15 million tons during May compared to 3.2 million tons in May last year, showing a slight fall of 1.6%.

Export dispatches registered a massive decline as they dived 76.97% from 746,550 tons in May 2021 to 171,915 tons in May 2022.

North-based cement mills sold 2.57 million tons in domestic markets during the month under review, which was down 5.16% from the dispatches of 2.71 million tons in May 2021.

South-based mills sent 576,385 tons to local markets in May this year, which was 18.28% higher compared to the dispatches of 487,311 tons in the corresponding month of previous year.

Exports from north-based mills recorded a sharp contraction with demand falling 64.42% from 203,625 tons in May 2021 to 72,450 tons in May 2022.

Similarly, exports from the south plunged 81.68% to just 99,465 tons in May 2022 from 542,925 tons in the same month of last year.

Cumulatively, in the first 11 months (July-May) of current fiscal year, total cement dispatches (domestic and export) came in at 47.62 million tons, lower by 8.8% than 52.22 million tons during the corresponding period of previous fiscal year.

Further analysis indicates that domestic offtake shrank 1.83% to 42.65 million tons from 43.45 million tons in July-May FY21 whereas exports dipped 43.32% to 4.97 million tons from 8.77 million tons.

North-based mills sold 35.31 million tons domestically in the 11-month period, showing a reduction of 3.82% from sales of 36.72 million tons during July-May FY21.

Exports from the northern region decreased 65.6% to 813,522 tons compared with exports of 2.36 million tons last year.

Domestic sales by southern mills were recorded at 7.33 million tons, showing an increase of 9.07% over 6.72 million tons in July-May of last fiscal year.

There was, however, a substantial decline of around 35.1% in exports from the south as volumes came in at 4.15 million tons as opposed to 6.4 million tons in the previous year.

Expressing concern over the political uncertainty in the country, a spokesman for the All Pakistan Cement Manufacturers Association pointed out that a continued downturn in the rupee value coupled with the skyrocketing prices of coal, electricity and petroleum products was badly affecting the business momentum.

He emphasised that the government should ensure political stability and must pay attention to industry concerns in the upcoming budget.

“We hope that the government will provide some relief to the industry by reducing duties and taxes as well as focusing on the Public Sector Development Programme (PSDP) and China-Pakistan Economic Corridor (CPEC) projects, which may help kick-start the industry’s revival in the next fiscal year,” he added.­­

Published in The Express Tribune, June 8^th, 2022.

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