Pakistan reaches record capacity utilisation in 9MFY18

Pakistan reached its highest-ever capacity utlisation at 93.7 per cent during the 9MFY18 period, ended March 2018. In total, cement dispatches rose 14.7 per cent YoY to 34.75Mt, according to figures supplied by the All Pakistan Cement Manufacturers Association (APCMA). Domestic dispatches in the northern region increased 19.3 per cent to 25.88Mt, while exports decreased 3.8 per cent to 2.43Mt. Similarly, domestic dispatches advanced 11.8 per cent to 5.43Mt in the south, whereas exports fell 17.4 per cent to 1.01Mt.

In March 2018 alone, total dispatches increased 17.3 per cent YoY to stand at 4.65Mt (March 2017: 3.97Mt). Domestic consumption showed 13.5 per cent growth to 4.26Mt, with 3.54Mt used in the north and 0.72Mt in the south. Exports surged to 0.39Mt, an 85 per cent rise compared to March 2017. This significant improvement, particularly in the north, has been attributed to the positive performance of exports to the Afghanistan market which reached 0.106Mt in March 2018 (March 2017: 0.037Mt).

While the monthly production capacity of the industry is 4.12Mt, utlisation reached 112.9 per cent (4.62Mt) in March 2018.

Budget proposal
The APCMA has proposed to the government that the customs duty on clinker and cement imports should be increased to 35 per cent and only be allowed if the quality is certified.

A spokesman for the association stated that the industry has been amongst the highest contributors to the national exchequer over the past few years, with a contribution of PKR110bn (US$949.85m). Presently, federal excise duty (FED) on cement is PKR1250.

“We appeal the Government to reduce FED to “Zero” to reduce the per bag price of cement and encourage cement consumption which is affected by high taxation,” he said.