Total dispatches and sales of cement from plants across Pakistan were affected due to rains and devastating floods witnessed during August. This pattern is likely to continue into September due to infrastructure damage and Eid holidays.
According to a report by Karachi-based brokerage house, Invest Ca, total cement dispatches declined by 19 per cent YoY last month to 2.4Mt. A significant 25 per cent YoY decline to 1.48Mt was witnessed in local dispatches during Aug-10, which can be attributed to the devastating impact the flood had on local transport and infrastructure.
Similarly, exports showed a decline of six per cent YoY during Aug-10 to 0.89Mt. But figures registered some improvement on a MoM basis as they increased 15 per cent compared to Jul-10.
Despite an overall slowdown, cement prices have remained firm at an average PKR324/bag during Aug-10 (+1.2 per cent MoM, +3.7 per cent YoY), which is expected to sustain the sector’s profitability during the current quarter.
Pakistan Cement Manufacturers Association (PCMA) told CemNet that despite of floodwater has started receding/subsided in major parts of the country, cement sales are expected to stay depressed during September, as roads are not operational in some parts of the country. It will probably take at least a week or more to restore, official pointed out. Moreover, the pace of construction activity will continue to decline in Ramazan, and for a week after the official Eid holidays.