Pakistani cement exports will be key beneficiaries as the demand for cement in Gulf countries will now further rise subsequently after United Arab Emirates (UAE) government has removed five per cent custom duty on cement to help the fast moving construction sector in Dubai.

This removal of import duty will decrease the cost of importing cement into UAE, in turn increasing the demand for imported cement. The increasing regional cement price is also benefiting Pakistani cement companies who are able to export cement at a price premium. Initially, cement was being exported to UAE at Freight on board price of $60 to $65/t, which has now jumped to $70 to $75 per tonne. With the duty removal in UAE and consequently demand for Pakistani cement rising, local cement companies can further increase export prices.

Already local cement companies have shifted their produce to exports as in the first 8 months (July-February of financial year 2008 have seen record high-level exports of 4.3 million tonnes. It is estimated that As per our estimates, we expect cement exports to reach 6.6 million tonnes in financial year 2008, exporters informed. Cement demand, throughout the world, has been on a consistent rise as construction activities gain pace. This has led to a significant cement price hike especially in countries like India and UAE. Cement prices in UAE have jumped up by over 40 percent in only 2008, forcing UAE government to remove 5 percent custom duty on the import of cement.

The prices of cement have touched record high levels in many countries across the globe. Only in 2008, cement prices in UAE first increased from $87 to $119 per tonne, and are currently standing at more than $136 per tonne. Price of even clinker has jumped to $70 to $80 per tonne in UAE. Similarly, prices in Russia have reached $280 per tonne while in neigbouring India they average around $118 per tonne. staff report