July sees surge in cement despatches

Updated 05 Aug 2020

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AN increase in cement despatches last month gave a much-needed boost to the industry after a disappointing FY20.
AN increase in cement despatches last month gave a much-needed boost to the industry after a disappointing FY20.

KARACHI: The first month of this fiscal year started with a positive note for cement makers, depicting a jump of 38 per cent in overall cement despatches (local and exports) to 4.383 million tonnes from 3.512m tonnes in the same period last year.

As per data of the All Pakistan Cement Manufacturers Association (APCMA), local uptake of cement in July 2020 increased by 32.67pc to 3.953m tonnes from 2.979m tonnes in July last year. Exports registered a more impressive increase of 66.14pc to 0.885m tonnes from 0.533m tonnes in the same month last year due to buoyancy in both international and domestic markets.

The growth in July 2020 despatches looks impressive in view of only 2pc growth last year that was totally supported by exports. Domestic cement utilisation in fact declined by 0.94pc in FY20, APCMA spokesman said.

The North Zone as usual led total growth on the strength of its domestic market that grew by over 39pc to 3.43m tonnes compared with 2.474m tonnes in July 2019.

Local sales in north zone rise sharply as construction boom gets underway

The trend in exports from the North Zone was highly disappointing with shipment of only 0.123m tonnes, down by 47pc compared with 0.231m tonnes in last year. The decline is due to the trade standoff with India and slow construction activities in Afghanistan.

South Zone mills could only despatch 0.518m tonnes in the domestic market in the first month of FY21, up by 2.39pc over the 0.506m tonnes in July 2019. The mills in southern region recorded a massive growth of 153pc in exports.

Exports of 0.762m tonnes were 1.5 times the domestic sales of cement in the Southern part of the country. Last year in July, cement exports from the South Zone were only 0.301m tonnes.

The APCMA spokesman said that an increase in cement despatches last month gave a much needed boost to the industry after a disappointing FY20.

However, the increasing trend in fuel and energy prices has badly impacted freight charges and overall cost of production, he added.

“The government must focus on public sector development projects and announced housing schemes to boost construction activities so that the employment and investment in the cement and allied industries can be safeguarded,” he urged.

Published in Dawn, August 5th, 2020