The All Pakistan Cement Manufacturers Association (APCMA) released more encouraging data for May 2023 than in the previous month of April, which was overshadowed by the season break during Ramadan. The cement representative body is salient about the upward trend. The rise in dispatches has been attributed to increased export and local buying before the announcement of the federal budget as a precaution against measures that would put upward pressure on prices. In addition, falling coal prices lead to higher exports by sea. Meanwhile, these numbers are above the expectations of the market.

Local/overseas cement dispatches increased by 19.4 per cent YoY to 3.966Mt in May 2023 against 3.321Mt sent during the same month of last fiscal year. Of this total, local cement dispatches were 3.43Mt compared to 3.15Mt in May 2022, showing an advance of nine per cent. According to Usama Rauf, analyst of AKD Securities, the perceived rise in prices following the budget could be a likely reason that local buying of cement increased. Moreover, bumper wheat crops in Punjab have increased farmers' spending power, which could also be a prospect.

Export dispatches also increased by 210.1 per cent as volumes rose from 171,915t in May 2022 to 533,155t in May 2023. Export pricing is becoming more viable after the rupee devaluation and a decline in coal prices.

Northern and southern dispatches
In May 2023 northern-based cement mills dispatched 2.88Mt of cement, showing an increase of 8.9 per cent against 2.65Mt of dispatches in May 2022. Southern-based mills delivered 1.09Mt of cement during May 2023, 60.8 per cent more than the 0.68Mt sent in May 2022.

Northern cement mills supplied 2.768Mt of cement in domestic markets in May 2023, showing a YoY increase of 7.6 per cent against 2.573Mt. Southern mills delivered 664,891t of cement in local markets in May 2023, which was 15.4 per cent more than the 576,385t supplied in May 2022.  

Exports from northern mills increased by 53.8 per cent as the volumes increased from 72,450t  in May 2022 to 111,451t in May 2023. Exports from the south surged by 324 per cent to 421,704t in May 2023 from 99,465t during the same month last year.

Cumulative data for 11MFY22-23
During the 11MFY22-23 (July 2022-May 2023), total cement dispatches (domestic and exports) were 40.52Mt, a fall of 14.9 per cent when compared 47.63Mt dispatched during the corresponding period of last fiscal year. 

Domestic deliveries during this period were 36.528Mt against 42.66Mt during the same period last year, showing a reduction of 14.4 per cent. Export dispatches were also 19.8 per cent less as the volumes reduced to 3.99Mt during 11MFY22-23 compared to 4.97Mt of exports in the 11MFY21-22. 

Northern mills dispatched 29.925Mt of cement domestically during 11MFY22-23, showing a reduction of 15.3 per cent from cement dispatches of 35.32Mt during July-May 2022. Exports from the north advanced by 19.7 per cent to 974,126t during July-May 2023 compared with 813,902t exported during the same period last year. Total dispatches by northern mills fell by 14.5 per cent YoY to 30.9Mt in 11MFY22-23 from 36.13Mt. 

Domestic deliveries by southern mills during July-May 2023 were 6.603Mt, showing a reduction of 10 per cent YoY from 7.339Mt. Exports from the south also declined by 27.5 per cent to 3.02Mt during July 2022-May 2023 compared with 4.16Mt exported during the year-ago period. Total dispatches by southern mills fell 16.3 per cent YoY to 9.62Mt during 11MFY23 from 11.5Mt.

Published under Cement News