Pakistan cement sector registers 16 per cent growth

Pakistan cement sector registers 16 per cent growth
Published: 13 November 2006

The cement sector has registered 16 per cent growth during the last four months from July to October against the corresponding period of last year, sources told Business Recorder on Friday.

Well-placed sources said the recently compiled statistics have revealed that the total production of the cement sector was 6.32Mt during the four months, saying the total operational capacity of 28 units has almost surpassed 33Mt, which was only 21Mt at the start of January this year. They, however, said the capacity utilisation was only 72 percent in October owing to Ramazan and Eid holidays. The production by the end of December is expected to reach 40Mt following the capacity enhancement by cement manufacturers.

Moreover, they said D.G. Khan cement, a new unit in Chakwal, will become operational soon, while the expansion projects of two entities-Best Way cement and Attock cement-have almost completed.

Other units, they said, were also planning production capacity enhancement as they see growing demand of the commodity in future, particularly when the construction of dams would start.

The last year’s cement crisis had forced the government to allow the import of unlimited quantities of cement without any customs duty and withholding tax through the private sector to meet demand for price stabilisation in the domestic market. The government had also earmarked an amount of Rs 720 million in the budget to arrest the cement price hike. The prices of cement as a result of the government intervention were reduced from Rs350 per bag to a level of Rs225-240.

This reduction in prices at local market discouraged its import and only 14,000t cement was imported during June to September against the L/C of 217,000t. They said the State Bank had also paid freight rebate to cement importers during the last four months.