Total cement dispatches in Pakistan rose 3.9 per cent YoY to 3.941Mt in March 2024 from 3.795Mt a year earlier, according to the All Pakistan Cement Manufacturers Association. Local dispatches dipped 0.6 per cent YoY to 3.336Mt from 3.357Mt in March 2023, contained by extreme weather, including heavy snowfall in the north and flooding in the southern coastal city of Gwadar, as well as moderating but still high inflation, and the month-long holy month of Ramadan. Meanwhile, exports jumped a notable 38 per cent YoY to 605,142t, up from 438,433 a year earlier. 

North-south dispatches
Dispatches from cement plants in the north of Pakistan rose 1.6 per cent YoY to 2.866Mt in March 2024, up from 2.821Mt. Of that, sales to domestic markets amounted to 2.742Mt, an increase of 0.8 per cent YoY from 2.721Mt. Exports from north-based mills expanded a robust 24.1 per cent to 100,431t, up from 124,672t in March 2023.

Sales from cement plants in the south of the country rose 10.4 per cent YoY to 1.074Mt, up from 0.974Mt.  Local domestic sales contracted 6.5 per cent YoY to 594,487t, down from 635,959t, while exports jumped 42.2 per cent YoY to 480,470t, up from 338,002t in March 2023.  

Cumulative dispatches in 9MFY23-24
During the first nine months of the FY23-24, total cement dispatches were up 2.7 per cent YoY to 34.502Mt from 33.6Mt during the same period of the FY22-23. Domestic dispatches during the period were 29.401Mt, a decline of 3.8 per cent YoY from 30.564Mt in the 9MFY22-23. Exports recorded a notable 68 per cent YoY increase during the period, coming in at 5.101Mt from 3.036Mt previously.  

Cement plants in the north reported total sales declining 2.1 per cent YoY in the 9MFY23-24 to 25.277Mt from 25.826Mt. Meanwhile, southern-based cement plants saw total sales rise 18.7 per cent YoY to 9.225Mt from 7.773Mt. Of this total, domestic sales were 5.164Mt, down 6.4 per cent YoY, from 5.516Mt in the same period of the previous fiscal year. Exports jumped 79.9 per cent YoY to 4.06Mt from 2.257Mt in the year-ago period.  

Outlook
Exports are expected to remain the key driver of growth for the Pakistan cement industry in the near term. Construction contracted a notable 17.6 per cent YoY in the 2Q24, according to the Pakistan Bureau of Statistics (PBS), after minimal growth of 0.7 per cent in the first three months of the year and a fall of 9.2 per cent YoY for 2023 as a whole. The PBS also estimates that cement production declined 8.7 per cent YoY in the second quarter. 

Nevertheless, a spokesman for Pakistan Cement Manufacturers Association noted that “Cement units have increased their capacities in expectation of higher construction activities in the country; however, operating at full capacity is still a distant dream”. Pakistan's listed cement sector reported record earnings in the first two quarters of the FY23-24 on the back of falling coal prices and higher cement prices. The wholesale price of cement rose 18.3 per cent YoY in March 2024. 

At the same time, southern producers are continuing to refocus sales towards export markets. Normalisation of trade relations with India, which has been halted since August 2019, would help boost further export growth. Pakistan’s Foreign Minister, Ishaq Dar, and Minister for Maritime Affairs, Qaiser Ahmed Sheikh, both noted intention to resume trade with India earlier this week. The resumption of land exports, impacted following the imposition of harsh duties by New Delhi, would also further bolster sales in Pakistan’s southern cement plants. In addition, northern-based cement plants will continue to focus on key market Afghanistan. Infrastructure development is in process at Kohat Cement’s greenfield site in Khushab, though the procurement of plant and machinery is not expected until the economic environment stabilises somewhat.