Pakistan: utilisation rates reach 5-year high

Cement despatches in Pakistan reached an all time high of 3.21Mt during April 2014 raising the industry hopes of a long awaited turnaround. The sector has achieved capacity utilisation of 75.21 per cent during first 10 months of the current fiscal year – the highest level achieved during last five years – and industry experts expecting that this will be increased to 80 per cent by the end of June 2014.

Although the overall increase in the cement despatches is only 1.17 per cent, domestic sales have continued to increase at a faster rate, which has compensated for the decline in cement exports.

Cement despatches to domestic markets during the month of April 2014 increased by 7.2 per cent to 2.54Mt compared with 2.37Mt during same month last year. Exports during April 2014 were 672,000t against 754,000t during April 2013, showing decline of 11 per cent. Total despatches during April 2014 were 3.21Mt compared to 3.12Mt during same month last year showing increase of 2.8 per cent.

During the first 10 months of current fiscal year, cement industry despatched 21.3Mt in local markets posting a growth of 2.7 per cent compared with local despatches during the same period of last fiscal year. Exports from the country declined by 3.39 per cent to 6.68Mt compared with exports during the first ten months of last year. The overall situation during first 10 months of current fiscal year showed a growth of 1.17 per cent compared to the same period of last fiscal year as total despatches increased to 27.98Mt against 27.66Mt from July 2012 to 2013 April.

The exuberance in the sector is based on an encouraging revival in construction sector and public sector development programmes. "With funding released by the World Bank for the Dassu power project and many power sector projects coming up we see a healthy growth in the cement sector," said the All Pakistan Cement Manufacturers Association.