Cement offtakes hit all-time high of 5.2mln tons in September

KARACHI: Cement offtakes hit an all-time high of 5.2 million tons in September as domestic consumption in northern areas increased during the month with exports also showing an upward trend, official data showed on Saturday.

Cement sales and exports stood at 4.3 million tons in the corresponding month a year earlier. Local uptake of cement in September increased 17.7 percent to 4.1 million tons. That was compared with 3.5 million tons in September last year. Exports increased 41 percent to 1.1 million tons from 0.79 million tons in the same month last year, according to All Pakistan Cement Manufacturers Association (APCMA).

In the north region, cement sales increased 16.3 percent to 3.5 million tons in September. That was compared with 3.03 million tons a year earlier. Exports from the north increased 9.3 percent to 0.29 million tons in September. That was compared with 0.26 million tons in the same month a year earlier.

The association said the recent construction package announced by the government helped cement industry recover from slowdown. Construction sector was boosted by incentives announced by the government to increase investment.

But, the association dismayed over raids conducted by the Competition Commission of Pakistan against some manufacturers. “Although cement industry faced huge losses during the financial year 2019/20, the recent raids by Competition Commission of Pakistan were a demoralising action against the industry,” it said in a statement.

The association said cement is a basic commodity required to play an important role in the development of the country. It is, however, subject to very high taxes including federal excise duty of Rs1,500 per ton equivalent to Rs75 per bag. “Government must abolish federal excise duty as this is not a luxury product,” it added.

There has been a positive growth in the southern region as well where cement sales increased 26.8 percent to 565,236 tons in September 2020. That was compared with 445,629 tons in September 2019. Exports from the southern region continued to grow and increased 56.5 percent to 837,033 tons in September from 534,751 tons a year earlier. “The industry is fully aligned to support the government in its efforts to restart the development and reindustrialisation,” the association said.

In July-September, cement sales and exports increased 21.9 percent to 13.6 million tons. Domestic sales registered a healthy increase of 18.8 percent, from 9.1 million tons to 10.8 million tons. Exports also grew 35.7 percent to 2.7 million tons.

The cement industry made heavy investments in new plant and machinery and modernisation over the last few years, which made availability of cement at very competitive rates compared to other countries in the region, said the APCMA.