All Pakistan Cement Manufacturers Association (APCMA) released local and overseas dispatch data for September and July – September on 3 October. The data reflects that Pakistan cement producers continued to experience headwinds in local sales, but exports remained beneficial. Cement dispatches declined by 5.63 per cent in September 2024 to 3.54Mt, compared to 3.751Mt dispatched during the previous fiscal year. APCMA attributed that due to increased cement prices due to irrational taxation and low demand, local dispatches were further reduced by 18 per cent and now stand at the level of 2017.

According to APCMA's breakdown, local cement dispatches during September 2024 were 2.650Mt compared to 3.233Mt in September 2023, showing a decline of 18.02 per cent. However, dispatches increased by 71.52 per cent on exports as the volumes jumped from 570,692t in September 2023 to 978,871t in September 2024.

Zones dispatches
In September 2024, northern cement mills dispatched 2.407Mt of cement, a decline of 12.78 per cent compared to 2.759Mt of dispatches in September 2023. Southern mills dispatched 1.246Mt of cement, 14.23 per cent more than the dispatches of 0.992Mt in September 2023. Northern cement mills dispatched 2.22Mt of cement in domestic markets in September 2024, a decline of 15.51 per cent compared to 2.63Mt dispatched in September 2023. Southern mills dispatched 470,931t of cement in local markets during September 2024, 28.95 per cent less than the 662,786t dispatched in September 2023.

Exports from northern mills increased by 42.93 per cent, from 142,226t in September 2023 to 203,280t in September 2024. Exports from the south also increased by 81.02 per cent, to 775,591t in September 2024 from 428,466t during the same month last year.


Cumulative dispatches
During the first three months of the current fiscal year, total cement dispatches (domestic and exports) were 10.269Mt, which is 13.59 per cent lower than the 11.885Mt dispatched during the corresponding period of the previous fiscal year. Domestic dispatches during this period were 8.130Mt compared to 10.133Mt during the same period last year, a reduction of 19.78 per cent. Export dispatches showed 22.19 per cent growth as the volumes increased to 2.14Mt during the first three months of the current fiscal year, compared to 1.75Mt exported during the same period last fiscal year.

Northern mills dispatched 6.863Mt of cement domestically during the first three months of the current fiscal year, showing a reduction of 17.65 per cent from cement dispatches of 8.33Mt during the same period last year. Exports from the North increased by 18.42 per cent to 507,101t during July-September 2024 compared with 428,235t exported during the previous year. Total dispatches by northern mills reduced by 15.88 per cent to 7.370Mt during the first three months of the current financial year from 8.762Mt in the last financial year.

Domestic dispatches by southern mills during July-September 2024 were 1.267Mt, a reduction of 29.63 per cent over the 1.8Mt of cement dispatched during the previous fiscal year. Exports from the south increased by 23.42 per cent to 1.632Mt during July-September 2024, compared with 1.323Mt exported in the last year. Total dispatches by southern mills reduced by 7.16 per cent to 2.9Mt during the first three months of the current financial year from 3.123Mt in the previous financial year.

A spokesman of APCMA mentioned that it is the fourth straight month in which we are experiencing a decline in cement dispatches. He expressed disappointment with the trend and said that the industry is on the verge of a crisis due to a continuous downfall in its capacity utilisation. “If the government gives relief in duties and taxes to curb the cost of production, it can boost the domestic demand and will also make our product competitive in international markets, enabling us to tap more opportunities to earn foreign exchange for the country,” he added.

Commenting on the dispatches, Usama Rauf of AKD Securities Ltd said the annual decline in cement dispatches was primarily due to an 18 per cent yearly drop in domestic dispatches, reflecting the overall slowdown in construction activity amid economic challenges and rising construction costs. On the contrary, exports witnessed significant growth, largely driven by higher exports from the south, where we expect the Sri Lankan government's PKR1/kg (US$0.036/kg) reduction in the cess levy on imported cement to have played an important role. Overall, increased export viability due to eased coal prices compared to last year's period also contributed.