Pakistan: cement demand to grow 8% in run-up 2018

Pakistan: cement demand to grow 8% in run-up 2018
Published: 22 July 2016


The Pakistani demand for cement during the ongoing FY16-17 and next financial year FY17-18 is expected to grow at a rate of eight per cent annually. This follows the government showing a strong commitment towards the China Pakistan Economic Corridor-led infrastructure development and its higher allocation of funds, up to 20 per cent of the PKR1.675trn (US$15.98bn) to the Public Sector Development Programme for the year.

FY15-16 saw double-digit growth in industry dispatches. The strong domestic demand and reduced excess capacities have encouraged a number of local leading players to announce expansion programmes. Utilisation levels also fared well, achieving a decade-high level of 85 per cent.

However, Pakistan’s cement exports declined 18 per cent YoY, which can be attributed to currency devaluation in its major export markets, the lifting of the export ban on Saudi cement, a growing global capacity and the availability of cheap cement. Exports to Afghanistan and Africa, which contribute 80-90 per cent of total exports, fell by 15 and 33 per cent YoY, respectively. Exports to India grew 43 per cent in FY15-16, representing a share of 17 per cent of total exports compared to 10 per cent in FY14-15.