Pakistan’s cement industry registered a contraction of 2.12 per cent in dispatches during November 2023, with total cement shipments coming in at 3.924Mt versus 4.009Mt in November 2022. According to a breakdown released by the All Pakistan Cement Manufacturers Association (APCMA), local cement dispatches during November stood at 3.262Mt compared to 3.862Mt in the same month a year earlier, marking a decline of 15.53 per cent. Exports, meanwhile, increased by 348.29 per cent from 147,757t in November 2022 to 662,374t in November 2023.
Industry experts believe cement dispatches in the local market declined due to the new axle load regime and offseason factors, which have hampered cement transportation.
In November 2023, northern cement mills dispatched 2.867Mt of cement, representing a decline of 12.24 per cent against 3.267Mt in November 2022. Southern mills shipped 1.057Mt of cement during November 2023, 42.44 per cent more than the 0.742Mt reported in November 2022.
Northern cement mills dispatched 2.723Mt of cement to domestic markets in November 2023, down 13.91 per cent from the 3.163Mt supplied in November 2022. Meanwhile, southern mills sent 538,668t of cement to local markets during November 2023, 22.85 per cent less than the 698,225t recorded during November 2022.
Exports from northern mills increased by 38.64 per cent as volumes rose from 103,824t in November 2022 to 143,942t in November 2023. Exports from the south also increased significantly, up 1080 per cent to 518,432t in November 2023 compared to 43,933t during the same month last year.
Aggregate dispatches
In the 5MFY24, total cement dispatches (domestic and exports) stood at 19.816Mt, 10.81 per cent up on the 17.883Mt supplied during the corresponding period of the last fiscal year. Domestic dispatches during this period came in at 16.688Mt compared to 16.354Mt in the 5MFY23, an uptick of 2.04 per cent. Export dispatches were also up by 104.60 per cent as volumes increased to 3.129Mt during the first five months of the current fiscal year compared to 1.529Mt of exports during the same period a year earlier.
Northern mills dispatched 13.836Mt of cement domestically during the 5MFY24, showing an increase of two per cent compared to 13.566Mt during July-November 2022. Exports from the north increased by 32.76 per cent to 695,206t during July-November 2023 versus 523,647t during the same period last year. Total dispatches by northern mills advanced by 3.14 per cent to 14.532Mt during the 5MFY24 from 14.089Mt in the previous financial year.
Domestic dispatches by southern mills during July-November 2023 were 2.851M, up 2.26 per cent YoY. Exports from the south increased by 142.01 per cent to 2.433Mt during July-November 2023 compared to 1.006Mt in the previous year. Total dispatches by southern mills expanded by 39.30 per cent to 5.284Mt during the 5MFY24 from 3.794Mt in the 5MFY23.
APCMA recommendation to Islamabad
An APCMA spokesman mentioned that some sources had implemented the axle load regime since 1 November 2023 without any consultation with stakeholders. “By massively increasing freight
charges on cement, coal, and other raw materials will increase. It will add unnecessary pressure on our inflation, which can increase by double digits. We want to suggest to the government that axle load be implemented in a phased manner over the next two to three years. We also foresee a major shortage of trucks, which will disturb the market supply. Exports will also be affected by this axle load regime,” he added.
