Cement sales 4% growth, Pakistan

Cement sales 4% growth, Pakistan
Published: 05 August 2005

Cement sales for the first month of the new fiscal year have witnessed a growth of around four per cent, said a research report prepared by Jehangir Siddiqui and Company with the data collected from the industry.

According to the report, cement sales for the first month of fiscal year 2006 stood at 1.43Mt in July 2005, which is four per cent higher on year to year than 1.38Mt in July 2004.

Local sales stood at 1.30Mt compared to 1.25Mt last year, whereas, exports at 0.13Mt slightly declined as compared to the previous year’s figures.

Comparing month-on-month figures, there is a decline of five per cent as cement dispatches in June 2005 stood at 1.51Mt compared to this month’s 1.43Mt sales. The report said cement sales witnessed a subdued growth mainly due to the supply side constraints as some plants were closed due to maintenance. In July 2005, several units opted for annual maintenance whereas some plants went for BMR activities, which suppressed growth during the period. Exports, on the other hand, declined slightly due to the upbeat local cement demand, which resulted in better local prices than those of exports.

Another factor behind the decline in exports was the government’s increasing pressure on the manufacturers to fulfil the local demand on a priority basis. According to the report for the month of July 2005, the capacity utilisation of the industry stood at 90 percent, based on the revised installed capacity of the industry, which after the revision stands at 18.9Mt, previously stood at 17.9Mt.

Capacity utilisation of Cherat, Bestway and Maple Leaf stood at 64 per cent, 72 per cent and 84 per cent respectively, whereas that of Pioneer, DG Khan and Lucky stood at 124 per cent, 100 per cent and 98 per cent respectively. Pioneer outperformed due to its high exports which stood at 19,000t for July 2005. The reports expected the supply constraints to ease with new capacities to come online in the next few months.