KARACHI: The total cement off-take went down 4.12 per cent to 27.45 million tonnes in the first six months of 2021-22.

Domestic despatches grew 2pc to 24.06m tonnes while exports declined 32.47pc to 3.39m tonnes in July-December, according to data released by the All Pakistan Cement Manufacturers Association (APMCA) on Tuesday.

Mehroz Khan of Topline Securities said local sales dropped amid a slowdown in the construction activity, rising construction costs and the conclusion of the amnesty scheme. Besides, local sales also fell because of seasonal factors. Construction activities slow down at the onset of winter season every year.

He attributed the fall in exports to higher freight costs, port congestion and a slowdown in world economies.

Slowdown in construction activity, end of amnesty scheme blamed for the year-on-year decline

Mr Khan said retail cement prices in December averaged Rs723 per bag of 50kg in the North region, unchanged from the preceding month. However, retail prices in the South increased Rs14 per bag on a month-on-month basis to Rs763 per bag in December.

North-based factories despatched 20.16m tonnes domestically, showing a year-on-year reduction of 0.32pc. Their exports declined 55.08pc to 543,888 tonnes while total despatches went down 3.42pc to 20.70m tonnes from a year ago.

Domestic despatches by South-based factories in July-December were 3.9m tonnes, up 15.23pc from a year ago. Exports registered a huge fall of 25.29pc to 2.847m tonnes in the first six months of the current fiscal year. Total despatches by South-based factories remained 6.75m tonnes, down 6.22pc from a year ago.

In December, total cement despatches plunged 4.2pc to 4.59m tonnes on a year-on-year basis. Local despatches stood lower by 2.45pc at 4.05m tonnes while exports came down 15.61pc to 538,002 tonnes.

North-based cement units sold 3.37m tonnes in domestic markets, down 3pc from December 2020. Their exports recorded a drop of 77.35pc as the quantities reduced to 27,885 tonnes on a year-on-year basis.

South-based factories despatched 680,126 tonnes in the local markets during December, down 1.15pc from a year ago. Their exports dropped 0.84pc to 510,117 tonnes over the same period.

The APCMA spokesman said the industry continues to face problems owing to the devaluation, increase in electricity tariffs, high cost of coal and heavy taxation. The cement industry does not get any subsidy from the government and contributes to the national exchequer by exporting its products, he said.

Published in Dawn, January 5th, 2022

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