Cement sales jump 30 per cent

Pakistani cement sales have recorded a growth of 30 per cent in the first
month of current 2004-05 fiscal year to reach at 1.362Mt compared to 1.045Mt
in the same month last year. According to the data compiled by the Pakistan
Cement Manufacturers Association (APCMA), export of cement in July recorded
at 0.132Mt up 0.2 per cent on month-on-month basis compared to June. “The
growth in cement sales will eventually stabilise over medium to long term at
the rate of 8-10 per cent, though we are currently assuming a growth rate of
12-14 percent over the next few years,” said Shagufta Irshad, an analyst at
KASB securities.

According to the APCMA, the capacity utilization rate in July has increased
to 95 per cent as opposed to 73 per cent that was reported during the same
month last year. But this capacity utilisation rate is based on the rated
capacity of 17.25Mt per annum as opposed to the  actual capacity of 20.84Mt
per annum (mtpa) for the cement industry, analysts said.

The APCMA is not incorporating the following capacities (1) Capacity
enhancement achieved through debottlnecking by Bestway, Maple Leaf, Cherat,
DGK, Lucky and other,  (ii) 50 percent of Gharibwal and Zeal Pak production
capacities and (iii)  600,000 ton of Zaman Cement plant’s capacity.

“The cement sector is booming in the country only because of increasing
export to UAE and its adjoining countries,” analysts said. Export of cement
went up 158 per cent year-on-year basis to 1.1Mt in the 2003-04
fiscal year. Cement sales have recorded a growth of 20 percent on
year-on-year basis, with sales of 13.6Mt during the last fiscal
year.