LSM posts 5.52 percent growth in February

KARACHI: Large scale manufacturing (LSM) sector posted a 5.52 percent growth in February over the same month a year earlier as infrastructure uplifts boosted cement and steel off-takes, while auto demand continued to increase, official data showed on Saturday.

LSM sector, however, decreased 1.5 percent in February over January, Pakistan Bureau of Statistics (PBS) data showed.

PBS data showed that non-metallic mineral products, including cement (up 11.3pc), automobiles (7.99pc) and iron and steel products (12.6pc) were the main catalysts of monthly growth in the industrial outputs.

In July-February, the sector, which accounts for 80 percent of manufacturing, increased 6.24 percent, which is equal to the target of 6.3 percent for the current fiscal year of 2017/18.

“The production in July-February 2017/18 as compared to July-February 2016/17 has been significantly increased in food, beverages and tobacco, coke and petroleum products, pharmaceuticals, non-metallic mineral products, automobiles, iron and steel products, electronics and paper and board while decreased in fertilisers and leather products,” PBS said in a statement.

All the three data collection authorities registered increase in production during February.

Oil Companies Advisory Council, logging outputs of 11 oil and petroleum products, measured 16.28 percent rise in output during the month. Provincial bureau of statistics, counting production of 65 products, recorded 12.73 percent growth. Ministry of industries, measuring output trend of 36 items, recorded 2.41 percent increase in production during the month under review.

Liquefied petroleum gas recorded the highest growth, in the petroleum group, of 62.75 percent to 66.6 million litres in February over the same month a year earlier, followed by motor gasoline (up 42.93 percent to 278.731 million litres) and kerosene oil (soaring 25.43 percent to 10.5 million litres).

Cement production rose 10.73 percent year-on-year to 3.405 million tons in February.

The central bank said public sector infrastructure projects and private investment in housing schemes increased demand of steel products and cement.

“Contrary to steel, however, the increasing demand (of cement) has largely been met by indigenous sources, as the industry has the requisite raw material along with capacity to cater to the growing needs of the economy,” the State Bank of Pakistan (SBP) said in a latest report.

Sales of automobiles continued to increase in February as lower interest rates encouraged consumers to get cars on auto finance.

“Increased demand for passenger cars can largely be explained by rising incomes, upsurge in popularity of online ride hailing services, and easy access to affordable bank finance,” SBP added. “The vibrancy in this market allowed car manufacturers to pass on the impact of rising assembling costs to consumers without taking a perceptible hit on their sales.”

PBS data further showed that in July-February electronics production rose 38.79 percent, followed by iron and steel products (30.85pc), automobiles (19.58pc), non-metallic mineral products (11.87pc), coke and petroleum products (10.26pc), pharmaceuticals (9.44pc), paper and paper board (8.06pc), rubber products (6.83pc), engineering products (5.21pc), food, beverages and tobacco (2.33pc) and textile (0.47pc).

Wood products recorded a 27.32 drop in production in the first eight months of the current fiscal year, followed by leather products (7.91pc), fertilisers (7.36pc) and chemicals (0.63pc).