Pakistan: During the first quarter of the current fiscal year, which began on 1 July 2014, the Pakistani cement industry posted growth of 9.9% in local sales compared with sales during the first quarter of previous fiscal year. However, exports declined by 8.1% compared with exports during the year-earlier quarter. Overall growth was 4.9% year-on-year for the quarter.

Cement despatches to domestic markets during the month of September 2014 were 2.42Mt, compared with 2.12Mt during September 2013, an increase of 13.9%. Exports during September 2014 were 0.73Mt against 0.82Mt during September 2013, a decline of 10.6%. Total despatches during September 2014 were 3.15Mt compared to 2.94Mt during the same month of 2013, an increase of 7.1%.

Officials said that Pakistan's cement industry is already facing a lot of issues due to high duty/tax structures, impractical imposition of sales taxes, increasing coal import duties, increasing power tariffs and axel load restrictions for haulage trucks that limit load capacities. Now they claim that it is also facing smuggling from Iran.

Domestic cement uptake in the south of the country is being seriously affected due to the influx of Iranian cement. Statistics showed that, against a 10.8% increase in domestic sales in the north during the first quarter of the current fiscal year, the domestic sales in the south showed an increase of only 5.4%.

A spokesman from the All Pakistan Cement Manufacturer's Association (APCMA) pointed out that despatches in the south should have been higher because the exports from this region during the first quarter of the current fiscal year increased by 12.2% to 0.78Mt against 0.70Mt during same period in 2013. On the contrary, exports from the north of Pakistan declined by 17.3% to 1.28Mt during the first quarter against 1.56Mt during same period last year.

The spokesman said that such lopsided sales are 'puzzling' at a time when the economic activities in the south have picked up appreciably. He said that a deep analysis of the situation revealed that the consumption has most probably increased at par or higher than the northern region but that Iranian cement smuggled without paying the duties and sales tax has penetrated the southern market, which is close to the Iranian border.