Cement sales surge on housing boom, high PSDP spending

Published July 3, 2021
A 13pc growth was recorded in June 2021 as compared to June 2020. — Dawn/File
A 13pc growth was recorded in June 2021 as compared to June 2020. — Dawn/File

KARACHI: The beginning of construction activities under the Naya Pakistan Housing Scheme and good spending under the Public Sector Development Programme (PSDP) pushed up local cement sales by 20.40 per cent to 48.119 million tonnes in FY21 from 39.965m tonnes in FY20.

Cement exports also saw an increase of 19pc from 7.847m tonnes during FY20 to 9.314m tonnes in FY21.

As a result, total cement dispatches (local sales and exports) surged by 20pc to 57.433m tonnes from 47.812m tonnes in FY20, data released by the All Pakistan Cement Manufacturers Association (APCMA) showed on Friday.

In the North region, local cement dispatches increased by 18.22pc to 40.582m tonnes in FY21 from 34.328m tonnes in FY20. Exports rose by 30.25pc to 2.566m tonnes in FY21 from 1.970m tonnes during the same period in last fiscal year.

Overall dispatches jump 20pc to 57.45m tonnes in 2020-21

South region domestic sales rose by 34pc to 7.537m tonnes during FY21 from 5.638m tonnes in FY20. Cement exports rose by 15pc to 6.747m tonnes FY21 from 5.877m tonnes during the corresponding period in previous fiscal year.

A 13pc growth was recorded in June 2021 as compared to June 2020. Total cement dispatches during June 2021 were 5.211m tonnes as against 4.623m tonnes during the same month of last year. Local cement dispatches in June 2021 increased to 4.668m tonnes as against 3.834m tonnes in June 2020, up by 22pc. Exports dropped by 31.12pc to 542,622 tonnes in June 2021 from 787,842 tonnes in June 2020.

Domestic cement dispatches in the North region during June 2021 jumped by 14pc to 3.859m tonnes from 3.384m tonnes in June 2020. Exports swelled by 338pc to 201,540 tonnes in June 2021 from 46,025 tonnes in June 2020.

In the South region, domestic cement sales grew by 79.35pc to 808,490 tonnes during June 2021 from 450,792 tonnes in June 2020. Exports from South, however, decreased by 54pc to 341,082 tonnes in June 2021 from 741,817 tonnes in June 2020.

The APCMA spokesman said FY21 has been a good year for cement as demand has grown considerably. Cement industry is expanding its capacity from 70m tonnes to around 100m tonnes with the hope that the demand would rise by 15pc annually for the next three years due to increase in allocation in PSDP and increase in China-Pakistan Economic Corridor-related projects along with housing and industrial demand.

Coal prices are showing significant upward trend as the C&F cost during financial year ended on 30th June 21 has increased to $140 per tonne from $60 per tonne same period last year, he said. Along with coal prices, electricity tariff and furnace oil prices have also soared thus pushing up overall cost of production by around Rs110 per 50 kg bag compared to same period last year, he added.

Published in Dawn, July 3rd, 2021

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