Cement sector posted growth for the second consecutive month in October

November 4, 2019: The cement sector has reported 9.19 per cent increase cement despatches in October 2019 dispatching 4.984 million tons cement, an all-time record for a month’s despatches, as compared to 4.564 million tons in October 2018.

As per the data of cement despatches compiled by All Pakistan Cement Manufacturers’ Association (APCMA), the cement despatches increased in September 2019 after negative growth in the first two months of the fiscal and the positive trend continued in October 2019.

North zone registered an increase of 15.86 per cent local despatches in October 2019 with 3.605 million tons despatches as compared to 3.111 million tons in October last year. It is interesting to note that the local cement despatches from the Northern part of the country alone were higher than the total cement despatches in any of the first two months of this fiscal. The sour point, however, is the domestic cement uptake in the Southern region remained low in October 2019, dispatching just 0.591 million tons, down by an alarming 29.41 per cent from 0.837 million tons in October 2018.

The exports continued the growth trend with over 27.95 per cent increase from 0.616 million tons in October 2018 to 0.788 million tons in October 2019. The growth in export was exclusively executed from the Southern region which rose by 48.75 per cent from 0.352 million tons in October 2018 to 0.591 million tons last month; whereas exports from North grew nominally from 0.264 million tons in October last year to 0.265 million tons in October 2019.

In the first four months of this fiscal, cement manufacturers dispatched 16.117 million tons of cement, 4.53 per cent higher than 15.419 million tons despatches during the same period last year. The local despatches were 13.312 million tons in the said period this year, 2.3 per cent higher than 13.011 million tons of local despatches in the first four months of FY 2018-19.

The mills situated in Northern part of the country dispatched 11.451 million tons to the domestic market, 11.14 per cent higher than the domestic despatches of 10.304 million tons in Northern region during the corresponding period last year. The South zone dispatched 1.861 million tons of cement for the domestic market in the July-October 2019 period that was 31.27 per cent less than 2.707 million tons dispatched during the same period last year.

The exports increased by 16.48 per cent in the period of July-October 2019 to 2.804 million tons from 2.408 million tons during the same period last year.

The export from North during the first four months of this fiscal was 0.954 million tons that were 5.64 per cent less than 1.011 million tons during the same period last year. However, in view of the total loss of the Indian market, the decline is not that sharp.

It is interesting to note that exports from the Southern region almost matched the domestic consumption as the region exported 1.851 million tons of cement during July-Oct 2019 period. The growth in cement exports from the South was 32.5 per cent, as it grew from 1.397 million tons in the corresponding period last year.

“It is strange that for the first time two cement producing centres of the country are depicting opposite trends in domestic use of cement. Last fiscal the domestic uptake was stronger in the South while this year Northern zone is in the big lead,” said the spokesman of APCMA.

He said that this growth trend is a sigh of relief but subdued consumption in the South is still a major concern. “Commencement of work on the government housing projects already announced will have a positive impact on the uptake of cement in both the regions and other construction materials too, creating earning opportunities for both skilled and unskilled labour,” he added.

He also appealed to the government to minimize duties and taxes on cement sector in order to increase cement consumption.

Posted on: 2019-11-04T09:36:00+05:00

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