Pakistani cement dispatches contracted in 7MFY22

According to the data released by All Pakistan Cement Manufacturers Association (APCMA), total local and overseas cement dispatches declined by 16.6 per cent 3.95Mt in January 2022 against 4.73Mt dispatched during the same month of last year. The breakdown of data shows local cement dispatches by the industry during January 2022 were 3.4Mt compared to 4.04Mt in January 2021, showing a reduction of 15.9 per cent. However, exports saw a massive decline of 20.7 per cent as the volume fell from 694,934t in January 2021 to 551,006t in January 2022.

During the first seven months of the current fiscal year (July 2021-January 2022), total cement dispatches were 31.4Mt, 5.9 per cent lower than the 33.37Mt dispatched during the corresponding period of last fiscal year. Further analyses indicate that domestic uptake slipped by 0.7 per cent to 27.465Mt from 27.657Mt during July-January 2021, whereas exports during the same period declined by 31 per cent to 3.94Mt from 5.71Mt.

A representative of the APCMA said that the drop in cement dispatches is hitting the industry badly at a time when the sector is already under pressure due to a sharp increase in the costs of production, including higher international coal prices, high power tariffs and increased transportation costs. Furthermore, he said that slowdown in the construction activities for public sector development projects amid unfavourable weather conditions is among the major causes of lower cement consumption.

Moreover, he added that the massive decline in exports should be a matter of concern for the government too as it is negatively affecting the much needed foreign exchange for the country. “One of the main reasons for the drop in exports via sea is the shortage of containers, increase in demand for container has increased freight cost of the container from the US$500 to the US$1500, making the Pakistani cement uncompetitive in the international market” said the spokesman.