Pakistan's cement exports rise but fall MoM in FY19

Pakistan's cement industry recorded a growth of 21.9 per cent in earning of foreign exchange revenue, 40.4 per cent in terms of quantity and 49.7 per cent in terms of Pakistani rupee earnings from cement exports in the FY18-19, according to Pakistan's Bureau of Statistics (PBS).

The government official data says that export revenue for the first 12 months of the current July 2018-June 2019 stood at US$271.72m by exporting 6.4Mt of cement and clinker during compared to US$222.84m at 4.56Mt in the same period last year.

In terms of export value in Pakistani rupee, exports advanced over 50 per cent during this period to PKR36.55bn. However, the value in US dollars fell 13.2 per cent from US$48.84/t to US$42.41/t.

However, in June 2019 alone the country's cement industry earned foreign exchange revenues of US$11.55m by exporting 273,071t, compared to US$17.050m at 395,152t in the previous months, and US$16.31m from 370,574t during June 2018. On a MoM basis this shows a decrease of 30.9 per cent and 32.2 per cent in terms of value and volume, respectively. A fall of 26.3 per cent and 29.2 per cent in terms value and quantity were recorded in YoY terms.

All Pakistan Cement Manufacturers Association (APCMA) is yet to release industry export data. On enquiry, a spokesman of association has added it would be done shortly.

Expert’s comments
Industry experts has stated that country's export performance during last fiscal is commendable despite weak local demand as the relief from exports to off-load excess capacity was possible with south-based producers (courtesy diverse routes through sea access). Moving forward, exports from the north are likely to remain constrained as access to both Afghanistan and India have diminished in recent years and conditions in both markets suggest a meaningful recovery in exports is unlikely in the medium term.

In Afghanistan the decline in exports has been due to competition from Iran’s cheaper cement. To highlight, cement exports to Afghanistan declined 50 per cent during FY11 to FY18. On the other hand, tensions on the border with India have halted cement exports there (duties of 200 per cent levied on Pakistan's products).