Pakistan’s cement dispatches grow 6% YoY in October 2025, boosted by strong domestic demand

Pakistan’s cement sector showed notable growth in October 2025, with cement dispatches rising by 6% year-on-year (YoY) to reach 4.75 million tons. 

According to a report by brokerage firm AKD Securities, this increase was driven by a strong 15% YoY surge in domestic sales, which reached 3.9 million tons, reflecting a rebound in construction activity, particularly supported by post-flood reconstruction efforts.

The rise in local demand was further supported by a 2.4% YoY reduction in local cement prices. Average daily local sales in October 2025 were recorded at 127,000 tons, marking an 11% month-on-month (MoM) increase and the highest level in 32 months. 

The industry-wide capacity utilization also rose to 67%, up 5.6 percentage points (ppts) YoY, compared to 62% in the same period last year.

While the domestic market saw positive growth, exports faced significant setbacks. Cement exports fell by 23% YoY to 830,000 tons, with shipments from the South region declining by 22% YoY (to 680,000 tons). 

Exports from the North dropped by 28% YoY, largely due to the Afghan border closure in late October 2025. The decline in South exports was also reflected in regional utilization figures, with the South’s capacity utilization falling to 89% from 100% in the same period last year. In contrast, North region utilization surged to 62%, the highest in 21 months.

According to the report, the cement industry is expecting a marginal decline in domestic prices for FY26, with a 0.3% YoY reduction anticipated. This decline will primarily be due to lower prices in the North, where prices are projected to fall by 1.2% YoY, influenced by a reduction in royalty rates in Khyber Pakhtunkhwa (KPK). In FY25, North prices surged past PKR 1,500 per bag due to higher royalty imposed by the Punjab government, but these prices are expected to normalize in FY26 as KPK’s lower royalty rates take effect.

Meanwhile, prices in the South are expected to rise by 4.1% YoY, driven by stronger export margins and increasing domestic demand. Overall, cement prices are forecasted to increase by 6.5% YoY in FY27, supported by improving demand conditions.

AKD Securities forecasted that the investment outlook for Pakistan’s cement sector remains positive, with analysts maintaining an ‘Overweight’ stance on the industry. A strong recovery is expected in FY26, driven by monetary easing, fiscal support, and improving macroeconomic conditions. Domestic offtakes are projected to grow by 7% YoY to 38.6 million tons, supported by a sharp decline in interest rates and increased allocations in the Public Sector Development Program (PSDP).

Top cement stock picks for the year include Lucky Cement (LUCK), DG Khan Cement (DGKC), and Fauji Cement (FCCL). 

The cement sector is on track for sustained growth, with domestic demand bolstering overall dispatches, although export challenges and regional dynamics pose hurdles. With strategic price adjustments and a favorable macroeconomic environment, the sector is poised for continued recovery in FY26 and FY27.