Cement despatches slow down in August 

–Overall despatches drop from 4.83m tonnes in July 2020 to 3.52m tonnes in Aug

–APCMA attributes the slow down to heavy rains, Eidul Azha and Ashura holidays

LAHORE: Cement despatches increased by 5.04pc to 3.520 million tonnes year-on-year in August 2020, as compared to 3.351 million tonnes in August 2019. However, on a month-on-month basis, the despatches were much less than 4.838 million tonnes recorded in July 2020.

According to data released by the All Pakistan Cement Manufacturers Association (APCMA), the local uptake of cement in August 2020 increased by 4.84pc to 2.794 million tonnes (2.665 million tonnes in August 2019), while exports appreciated by 5.82pc to 0.725 million tonnes (0.685 million tonnes last year).

During the month under review, Pakistan’s northern mills despatched 2.493 million tonnes of cement in the domestic market as compared to 2.347 million tonnes in August 2019, registering an increase of 6.26pc. Exports from the north stood at 0.211 million tonnes, which was 8.45pc higher than the exports of 0.195 million tonnes last year. 

On the other hand, south-based mills continued with the declining trend in the domestic market, despatching only 0.301 million tonnes of cement in August 2020, 5.6pc less than 0.319 million tonnes recorded in August 2019. Exports from south mills, however, increased 4.78pc to 0.515 million tonnes in August 2020 as compared to 0.491 million tonnes in August last year.

The country’s overall despatches during the first two months of the current fiscal year (FY21) surged by 21.78pc, from 6.863 million tons in July-Aug 2019 to 8.358 million tonnes. Domestic despatches stood at 6.747 million tonnes in Jul-Aug 2020, up 19.53pc from 5.644 million tonnes in the same period last year. Exports during the period under review registered an increase of 32.2pc, from 1.218 million tonnes in Jul-Aug 2019 to 1.61 million tonnes.

The APCMA spokesman stated that the jump in cement sales during July was “probably a one-off phenomenon”.

“The industry was expecting the July momentum to continue but an appreciable decline in monthly domestic uptake and exports is disappointing,” he said. “The decline was mainly due to heavy rains, Eidul Azha and Ashura holidays.” 

He said that the industry is unable to understand as to why the impact of the construction package has not been felt in the south. Moreover, he added, the normal growth of 6.26pc in domestic sales in the north suggests that the impact of the construction package was also not visible there in August. 

He requested the government to minimise duties and taxes on the cement sector in order to increase consumption. 

He also wondered why the cement sector and captive power plants were excluded from subsidized power and gas that is available to five exporting sectors. “Cement is an energy-intensive sector and availability of energy and power at concessional rates will boost cement exports appreciably.”

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