KARACHI
The manufacturers in the northern areas of Pakistan have increased cement prices by Rs 15-20 per bag as a result of the surge in Federal Excise Duty (FED) to Rs 1.25/kg from Rs 1.00/kg, as announced in the Federal Budget 2017-18, industry sources said.
This is the second consecutive instance in last two months where prices have been on an upward trajectory in the north, they added.
Previously, in June 2017, the increase of Rs 50-55/bag in north areas was a reversion of cut in cement prices by the northern players. The reason for reduction in prices was anticipation of increase in demand supply gap due to a newly operational plant.
Prices in the southern region are currently hovering within range of Rs 560-585/bag and are expected to witness a similar upward pattern as seen in north within expected time frame of 7 to 10 days, settling in the range of Rs 575-600/bag.
The analysts expect local cement dispatches for the month of June 2017 to clock in at 3.0-3.1 million tonnes, (down 8.5 per cent – 11.7 per cent MoM) taking full year (FY17) local dispatches to 36.3 million tonnes vs 33.0 million tonnes (up 9 per cent YoY) as recorded in FY16.
The decline in monthly sales figures are due to a slow-down in construction activities during Ramadan, coupled with the prolonged Eid Holidays.
