Domestic uptake of cement nosedived in January 2019

Cement sector posted double digit decline of 10.70 percent in growth in the month of January compared with corresponding month raising alarm bells among producers sitting on huge production capacity. Data released by the All Pakistan Cement Manufacturers Association (APCMA) reveals that the cement industry despatched 3.646 million tons in January 2019 against despatches of 4.083 million tons of the commodity despatched in January 2018.
It seems that the domestic sector almost collapsed in last month as the domestic uptake of cement nosedived from 3.737 million tons in January 2018 to 3.066 million tons. The domestic uptake thus declined by 17.94 percent.
The buoyancy in exports stayed on course as exports increased by a healthy 67.27 percent. The industry exported 0.579 million tons of cement in January 2019 against exports of mere 0.347 million tons exported in January 2018. For the first time this fiscal the domestic consumption posted nominal decline in the South as well, while the downslide in the Northern region of the country continued unabated.
Uptake in North was only 2.355 million tons last month against 3.018 cement consumed in January 2018. The consumption in the South slipped from 0.719 million tons in January 2018 to 0.711 million tons in January 2019.
Cement despatches in the first seven months of this fiscal stood at 26.765 million tons that was only 1.67 percent higher than the despatches of 26.325 million tons achieved during the same period of last year. Out of this, exports during July-Jan 2019 period were 4.141 million tons which was 50.47 percent higher than the 2.775 million tons exported in the corresponding period last year. A look at the regional performance shows that mills located in the North suffered more than the mills located in the South.
The domestic consumption of North based mills declined by 8.43 percent to 17.831 million tons in the first seven months of this fiscal from 19.473 million tons same period last year. The exports from North declined 16.71 percent to 1.692 million tons during the period under discussion from 2.032 million tons in July-Jan 2018.
During July-Jan 2019, the domestic uptake in South increased by 16.89 percent to 4.793 million tons and exports increased by a whopping 239.89 percent to 2.448 million tons from 0.721 million tons respectively during same period last year. APCMA spokesman expressed dismay on the constant decline in cement uptake in the country and it felt this is because of reduction in government spending on infrastructure.