Cement demand weakens in local and foreign markets

Karachi: November, 2011 “proved to be worst month” for cement manufacturers as its dispatches declined by 6.47% compared with corresponding period of last year due to Eidul Azha and less demand in local and export market. Data released by All Pakistan Cement Manufacturers Association say local demand continuously declined since July 2011 when sales rose by 16.31% compared with production in July 2010. Increase in local demand reduced to 10.61% in August, 8.81% in September and 5.77% in October over dispatches made in corresponding periods of these months last year. “November is first month this fiscal when demand in local market declined negative 5.12%” said APCMA spokesman on Friday.

He said export sector performance during last five months remained lopsided with exports declining in three months including November and increasing in two. However, positive trends in domestic market raised hopes sales are almost three times higher than exports.

He said negative growth of sales in November was shock as majority of mills are operating at loss. A total of 12.72 million tons was despatched in first five months of this fiscal as mills operated at average capacity of 69.05% – lowest capacity utilization since 2002-03. Exports during July-November 2011 registered a decline of 3.90% as Pakistan was continuously losing through sea routs.

Spokesman urged government to initiate badly needed infrastructure projects to boost growth, economic activities by improving governance. “It will be unfortunate if state-of-art plants in the country were forced to close as cement is only commodity outside textiles that has potential to increase exports. Certain facilitations announced for this sector including transport subsidy on export have not been honoured that has depressed exports,” he added.

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