Government fails to facilitate cement export, Pakistan

Government fails to facilitate cement export, Pakistan
Published: 22 March 2007

The government has failed to facilitate cement export, as Port Qasim and Karachi Port Trust authorities have expressed inability to provide ’dedicated berths’, saying that such an action would hurt international trade, official sources told local press.  
 
They said that national average price of cement is around Rs230 per 50kg at some places, but the price of prime brands was Rs 243 per 50kg on March 21. The Economic Coordination Committee (ECC) of the Cabinet in its last meeting had directed the Ministry of Industries and Production to take immediate action in case of unreasonable price increase.  
 
The All Pakistan Cement Manufacturer Association (APCMA) has lodged complaint with the concerned ministry that both ports were not ready to dedicate facilities necessary to meet export orders.  
 
"Local cement manufacturers have excess production capacity of 10 million tons and are also being offered very good price, but they are unable to meet the export orders due to lack of facilities at the ports," sources said.  
 
The APCMA said that its member units are facing huge losses due to decline in local prices. "Export is the only option to bridge this loss," it said. An official of federal government confirmed that APCMA is not being given dedicated berths as it would impact other trade activities, but with the opertionalisation of Gwadar Port, it would be able enhance exports.  
 
However, Gwadar port is far away from Karachi; which means freight charges would increase by Rs 15 per bag. Attock Cement is the only unit, which can benefit because of its location.  
 
The number of operational units has increased to 28 from 22 in 2001-02, while the annual installed capacity is now 33Mt against 15.72Mt in 2001. 
 
Sources said that local consumption of cement had increased to 11.6Mt in 2006 against 9.83Mt in 2001, whereas the export potential had reached 1.203 million tons in 2006 as compared to 0.107 million tons in 2001.  
 
After witnessing declining trend in cement prices, the manufacturers are now running their units at 75.5 percent capacity, against 62.5 percent in 2001 and 84 percent in 2005-06.  
 
Sources said that the Ministry of Industries and Production had promised with the cement manufacturers in its last meeting to help construct silos at ports but the project does not seem to materialise in near future.