Cement Sales to Fall by Up to 13-17% in December

Pakistan’s cement industry sales in December 2022 are likely to clock in at 3,500,000-3,700,000 tons, down 20-24 percent year-on-year (YoY). However, the same is likely to decline by 9-13 percent month on month (MoM).

According to Topline Securities, local sales are expected to be down by 13-17 percent YoY to 3,400,000-3,500,000 tons amid a slowdown in construction activity, overall economic slowdown, and higher construction costs.

On an MoM basis, Local sales are estimated to decline by 9-13 percent MoM, wherein average daily sales in the North and South regions are hovering at 89,000 tons per day and 22,000 tons per day, respectively. This decline is likely due to seasonal factors where we see a slowdown in cement sales at the onset of the winter season and a slowdown in construction activities.

Exports during December 2022 are likely to be down by around 72-76 percent YoY and 5-9 percent MoM. The attrition in exports is on the back of the global economic slowdown, higher interest rates, and unfavorable export pricing. Exports sales in 1HFY23 are expected to be down 49-53 percent YoY.

In 1HFY23E, cement sales are expected to fall by around 20-24  percent YoY with local sales also posting a decline by 16-20% YoY. Lower offtakes in local cement dispatches are on the back of rising construction costs and inflationary impact restricting the demand growth.

As per the Pakistan Bureau of Statics (PBS), Cement retail prices in December 2022 averaged Rs. 1,030 per bag in the North which is more or less similar to the price witnessed in November 2022. In South, average prices clocked in at Rs. 1,064 per bag, with an increase of Rs. 10 per bag from November 2022.

Going forward, some recovery in 2HFY23 is anticipated as flood rehabilitation programs gain pace as we approach General Elections. Declining coal prices could also provide support to the sector margins going ahead.



Get Alerts

Follow ProPakistani to get latest news and updates.


ProPakistani Community

Join the groups below to get latest news and updates.



>