Local Cement Sales Rise But Exports Plummet

Buoyancy in the domestic cement market continued unabated in August as local sales increased by 10.85 percent compared with sales during the corresponding month of last year. However, exports nosedived by 26.47 percent, reducing the overall sales growth to 5.05 percent only.

According to the data for the month of August 2017, Cement dispatches in the month were 3.766 million tons as compared to 3.585 million tons in August 2016.

In August 2017, the domestic cement dispatches in the Northern region were 2.731 million tons against dispatches of 2.495 in August 2016 whereas the dispatches in the Southern region were 0.625 million tons in August 2017 against dispatches of 0.532 million tons in same month last year.

Exports from North were 0.307 million tons last month against 0.355 million tons in August 2016. The exports from the South stood at 0.103 million tons in August 2017 against exports of 0.203 million tons in August last year.

A spokesman of All Pakistan Cement Manufacturers Association said that the capacity utilization in August 2017 was more than 96 percent as the domestic cement dispatches are constantly increasing which is a good sign. This, he added, indicates that the economy is in good shape.

In the first two months of this fiscal year, the industry dispatched 7.148 million tons of cement showing an overall growth of 20.81 percent over the corresponding period of last fiscal. During this period the domestic consumption increased by 27.95 percent but exports declined by 13.39 percent.

It is worth noting that the domestic cement consumption during July-August of this fiscal increased by 28.51 percent in the North and by 25.41 percent in the Southern part of the country. In contrast, the exports from North declined by only 2.47 percent compared with a decline of 25.41 percent in the South.

This should be a matter of concern for the authorities because in the past the South based mills being nearer to sea were the leading cement exporters.

However, he pointed out that constant decline in cement exports was a source of concern for the industry. He said the decline in exports was in line with the overall decline in non-textile exports which indicates non-competitiveness of our manufacturing sector.

He said that this calls for review of government policies, regulations and taxation for all non textile exporting sectors as exports revival would strengthen the domestic manufacturing sectors and boost the economy.

It is pertinent to note that the exports to Afghanistan during July-August 2017 increased by 21.41. However, this increase was meager as compared to the fall in exports during July-August 2017 to India by 21.76 percent and other countries by 37.53 percent.