February 02, 2022: Cement despatches declined by16.58 percent in January 2022. Total Cement despatches during January 2022were 3.95 million tons against 4.73 Million Tons despatched during the same month of last fiscal year.
According to the data released by the All Pakistan Cement Manufacturers Association (APCMA), local cement despatches by the industry during the month of January 2022 were 3.4 million tons compared to 4.04 million tons in January 2021, showing a reduction of 15.87percent. Exports despatches suffered a massive decline of 20.71 percent as the volumes reduced from 694,934 tons in January 2021 to 551,006 tons in January 2022.
In January 2022, North-based cement mills despatched 2.707 million tons of cement in domestic markets showing a reduction of 18.29 percent against 3.313 million tons despatches in January 2021. South-based mills despatched 693,453 tons of cement in local markets during January 2022 which was 4.82 percent less compared to the despatches of 728,568 tons during January 2021.
Exports from North based mills massively declined by 94.12 percent as the quantities reduced from 233,404 tons in January 2021 to 13,727 tons in January 2022. Exports from the South however increased by 16.41 percent to 537,279 tons in January2022from 461,530 tons during the same month last year.
During the first seven months of the current fiscal year, total cement despatches (domestic and exports) were 31.4 million tons that calculate to 5.89 percent lower than 33.37 million tons despatched during the corresponding period of the last fiscal year. Further analysis indicates that domestic uptake of the commodity reduced by 0.69 percent to 27.465 million tons from 27.657 million tons during July-January2021whereas exports during the same period declined by a massive 31.04 percent to 3.94 million tons from 5.71 million tons during July-January2021.
North-based Mills despatched 22.87 million tons of cement domestically during the first seven months of the current fiscal year showing a reduction of 2.85 percent than cement despatches of 23.54 million tons during July-January2021. Exports from North declined by 61.39 percent to 557,615 tons during July-January2022 compared with 1.444 million tons exported during the same period last year.
Domestic despatches by South-based Mills during July-January2022 were 4.59 million tons showing an increase of 11.67percent over 4.115 million tons cement despatched during the same period of last fiscal year. There was however substantial decline of around 20.78 percent in exports from the south zone as the volumes reduced to 3.384 million tons in the first seven months of the current fiscal year from 4.272 million tons during the corresponding period of the last fiscal year.
A spokesman of the All Pakistan Cement Manufacturers Association said that the decline in cement despatches is hitting the industry badly while the industry is already under pressure due to sharp increase in the cost of production that includes international coal prices, high power tariff and transportation costs. He said that slowdown in the construction activities for public sector development projects amid unfavourable weather conditions is among the major causes of lower consumption of cement.
Moreover, he added that, the huge decline in exports should be a matter of concern for the government too as it is negatively impacting the much needed foreign exchange for the country. “one of the main reasons for the drop in exports via sea is the shortage of containers, increase in demand for container has resulted in an increase in freight cost of the container from US$500 to US$1500, making the Pakistani cement uncompetitive in the international market” said the spokesman.