Industry

Consumption of domestic cement declined by 16.70pc in March

Karachi, April 03, 2020: As expected Coronavirus had its impact on domestic consumption that declined by 16.70 percent in March while the exports grew at lowest pace of 5.27 percent as the global markets are equally under pressure due to the same reason.

According to the data of APCMA in March, the industry despatched 3.721 million tons of cement that was 14.26 percent less than the despatches of 4.340 million tons during the corresponding month of last year. The pressure was heavier from the domestic market where the uptake was reduced to little less than 3.2 million tons from 3.85 million tons in March 2019. 

Exports though inched up from 0.482 million tons last in March 2019 to 0.507 million tons this March 2020. Increase in exports should be viewed with huge loss of Indian market. Exports to India have remained zero this fiscal while last year during the first nine months, Pakistan exported 0.716 million tons of cement to India.

North based mills despatched 2.749 million tons locally, which was almost 10.48 percent lower than the despatches of 3.017 million tons during the corresponding month of last fiscal. As per recent trends, exports from the North based mills also decreased in March 2020 by 18.85 percent to 0.107 million tons, from 0.132 million tons in March 2019.

Southern region of the country reported a decline in domestic despatches by 40.96 percent, as it fell from 0.787 million tons in March 2019 to 0.464 million tons in March 2020 while exports registered a rise of 14.32 percent to 0.401 million tons last month, as compared to 0.351 million tons in March 2019.

Furthermore, Cement industry experts opined that “In the wake of the lockdown extended till April 14 which means that the economic activities would remain further subdued. The industry is hoping to get some relief package from the government as managing despatches is becoming extremely difficult with each passing day”.

Prime Minister’s incentive package for construction industry will help to increase the cement consumption in the country. However, cement industry is expecting reduction in federal excise duty which is already very high in the region.

Moreover, industry experts also added that the additional government levies slapped on the industry in this year and the electricity rate should also be reduced.

APCMA spokesman added that “Overall in the first nine months of this fiscal the industry managed to despatch 37.035 million tons of cement that is 7.06 percent higher than 34.593 million tons of the commodity despatches during July-March 2018-19”.

The domestic consumption during this period amounted to little over than 30 million tons while the exports amounted to 6.5 million tons. The domestic cement despatches increased during this period by 3.82 percent only while the cement exports registered a rise of 25.63 percent.

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