May 16, 2006	Tuesday	Rabi-us-Sani 17, 1427

KARACHI, May 15: As the price of locally produced cement is already on the decline, the first Chinese cement shipment of over 26,000 tons arrived here and hit the market in the current week, dealers said. However, they appear confused in revealing the actual market price of the Chinese product and its quality.

One of the dealers said that the price of the Chinese cement may range between Rs250-300 per 50 kg bag, while another said that the imported cement may sell at over Rs300. “The price situation will be cleared in the next two days,” dealers said.

To a query over the quality of Chinese cement since the shipments arrived in bulk or loose quantity - they said it was difficult to give a clear picture about the quality.

They said that currently the importer was reportedly busy in packing of cement in one ton and 50 kg bags. Some dealers said that the Chinese cement might find way into the market with a brand name like Tiger or Cheetah or may be with some other label.

Meanwhile, the price of locally produced cement like Javedan and Thatta, which was Rs330-335 last month, is now priced at Rs310-315. Power cement is selling at Rs 315 as against Rs330 last month. These cement bags were selling between Rs350-370 in the first week of April.

“A tough price war is expected between the locally produced cement and the Chinese commodity this week amid concerns about quality of the former,” dealers said.

A leading cement-maker and exporter said that Pakistan had no capacity to store or pack bulk cement at the port. The bulk cement was unloaded into dump trucks and was stored in yards.

He said loose cement was never stocked in the open. It is kept in specially constructed silos or in bags. This cement will naturally absorb moisture and will not be suitable for building durable concrete structures.

He added that there were market reports that the ship, which unloaded cement last week, was in high seas for more than three weeks. It is very difficult to say anything about the quality of this cement. One fact is clear that country’s valuable foreign exchange has been spent on this import. The import duty has been lost and a heavy subsidy of Rs1,200 per ton will be paid to the importers.

He termed the government’s decision early last month as hasty and untimely in respect of cement sector. The Pakistani cement sector has embarked upon a very ambitious expansion programme and it is expected that the production capacity of cement in the country will increase by almost 100 per cent in next three years. This expanded capacity will not only meet all domestic requirements but will have substantial exportable surplus as well. The cement sector has made investment of billions of rupees on this expansion programme, he added.

The manufacturer went on to say that at least three new plants were coming into production during this month. The importers will make the life of local producers miserable, he added.

The cement executive said the short-lived rise in the cement prices in last April was because of the government instructions to its various departments to use the development grants as early as possible, and also due to the technical faults in one or two cement plants reducing the supplies for about a fortnight. The middle-man took the advantage of this situation and increased prices on their sweet will.

He pointed out that the foreign exchange earning had stopped due to discontinuation of exports to Afghanistan. Pakistan had established a market in Afghanistan by a lot of efforts. The country is likely to lose the market permanently because cement has already started arriving there from Kirgyzstan. “If Iran also starts sending its cement to Afghanistan, we will lose our market permanently,” he lamented.