Pakistan witnesses a 14.69 per cent decline in cement despatches

ISLAMABAD: The All Pakistan Cement Manufacturers Association (APCMA) reported a decline in cement despatches across Pakistan in January 2024.

According to APCMA, total cement despatches for the month were 3.414 million tonnes, down from 4.006 million tonnes in January 2023.

Local cement despatches in Pakistan during January 2024 saw a notable decline of 17.30 per cent, standing at 2.967 million tonnes compared to 3.588 million tonnes in January 2023. In contrast, export despatches experienced a modest 6.82 per cent increase, rising from 418,067 tonnes in January 2023 to 446,595 tonnes in January 2024.

The northern cement mills dispatched 2.434 million tonnes, marking a 15.83 per cent decline from January 2023. Similarly, southern mills dispatched 979,970 tonnes, a 12.08 per cent reduction compared to January 2023.

In the domestic market, northern mills dispatched 2.385 million tonnes in January 2024, showing a 16.50per cent decline from January 2023. Southern mills dispatched 582,258 tonnes in January 2024, reflecting a significant 20.43per cent decrease compared to January 2023.

Exports from northern mills increased by 38.81 per cent, reaching 48,883 tonnes in January 2024, up from 35,215 tonnes in January 2023. Similarly, southern mills experienced a nominal 3.88per cent increase in exports, reaching 397,712 tonnes in January 2024 from 382,852 tonnes in January 2023.

For the first seven months of the current fiscal year, total cement despatches, combining domestic and exports, were 27.296 million tonnes, reflecting a 5.92per cent increase from the 25.770 million tonnes dispatched during the same period last fiscal year. Domestic despatches during this period declined to 23.196 million tonnes, a 1.79per cent reduction from 23.618 million tonnes last year. In contrast, export despatches showed a robust 90.49per cent increase, totaling 4.1 million tonnes during the first seven months of the current fiscal year, compared to 2.152 million tonnes in the same period last year.

Northern cement mills dispatched 19.157 million tonnes domestically during the first seven months of FY2024, showing a 1.14per cent reduction from the 19.378 million tonnes dispatched from July 2022 to January 2023. Exports from northern mills increased by 33.71per cent to 820,056 tonnes during July 2023 to January 2024 compared with 613,289 tonnes exported during the same period last year. Overall, despatches by northern mills remained nearly flat at 19.977 million tonnes during the first seven months of the current fiscal year, similar to the 19.991 million tonnes during the same period last fiscal year.

In the south, domestic cement despatches by southern mills during July 2023 to January 2024 were 4.039 million tonnes, reflecting a 4.74 per cent reduction from the 4.240 million tonnes dispatched during the same period last fiscal year. However, exports from southern mills massively increased by 113.11per cent, reaching 3.279 million tonnes during July 2023 to January 2024, compared with 1.539 million tonnes exported during the same period last year. Total despatches by southern mills increased by 26.65 per cent, reaching 7.319 million tonnes during the first seven months of the current fiscal year from 5.779 million tonnes during the same period last fiscal year.

A spokesperson for APCMA attributed the decline to the impact of the “new axle load regime” implemented last year . This resulted in a decrease in truck lifting capacity and saw a steep increase in freight costs, inland transportation cost, and handling and shipping costs for export consignments. “All these factors will put pressure on cement prices likely to result in a higher cost to the domestic consumers and adverse effects on export fronts”, the spokesperson said.