The growth demand for cement within the country registered 13 percent increase during the first eleven months of the prevailing fiscal (July – May 2006) which comes to the total demand at 15.18Mt, as compared to 13.40Mt during the corresponding period of last year.
On the export front, the demand for cement was however five per cent lower at 1.36Mt. Consequently, total industry cement dispatches stood 11 per cent higher at 16.54Mt. Overall, the higher demand figures have resulted from improved housing and construction activities in the country.
Company margins are to be supported on the successive increases in cement prices during the year. The outlook for cement demand going forward represents a strong picture on the back of 52 per cent higher PSDP allocation for the year 2006-07 at Rs415bn.
This is expected to act as a stimulus for cement demand ensuing from increased construction activities and infrastructure and water reservoir development projects.
Pioneer cement is amongst the few companies in the industry that will reap the benefits of pursuing early and timely expansions. During the last fiscal, Pioneer cement has completed an optimization plan of its existing production line, which ultimately enhanced the production capacity of the company to 2470 tons per day from 2100 tons per day previously.
In addition to this, the company has also expanded its production capacity by establishing a new production line at 4300 tons per day. This expansion has ultimately enhanced the overall production capacity of the company to 7000 tons per day or approx. 2.0Mta.