Pakistan cement sales stood at historic level in November with sales of more than 2Mt per month with diminishing rumours about cartelization in the cement sector.
The industry sources told the Daily Times that a historic growth of 67.44 per cent was recorded in local and export dispatches of cement in November. The local dispatches stood at around 1,837,288t besides the export of 170,850t in the month of November. The total cement dispatches in the month of November, therefore, stood at 2,008,138t.
The market sources are of the view that increases in cement demand due to attractive price of cement per bag, besides the dying down of rumours on cartelization in the industry, was the prime reason behind the robust growth in cement dispatches. The cement prices have dwindled down to Rs 170 to Rs 185 per bag in Punjab and the NWFP and are ranging between Rs 200 and Rs 230 per bag in Sindh. An increase in supply of cement has hit price mechanism further. However, since no abnormal rise in dispatches in expected in December, the price is likely to stabilise then, said the market sources.
The stock market had reacted positively to media reports on cartelization in the cement sector. But the central chairman of the All Pakistan Cement Manufacturers Association (APCMA) had denied the reports. According to the sources, hoarders had booked heavy purchase orders while apprehending a price increase of cement with the reports about cartelization in the sector. As the APCMA chairman soon denied any such move by manufacturers, hoarders offloaded their stocks heavily that took the November dispatches to record level.
The Monopoly Control Authority had proceeded against cement manufacturers for cartelizing a year before, fining some leading manufacturers after having sufficient proof of it. Local dispatches during the first four months of 2006-07 are recorded at 8,104,817 metric tons compared with 6,576,102 metric tons during the corresponding period of previous year, increasing local dispatches to 23.25 percent. The exports, similarly, have risen to 46.55 percent during the first four months with 954,663 metric tons in July-November 2006-07 against 651,414 metric tons in same period of previous fiscal.