
Displaying items by tag: APCMA
APCMA publishes data on cement despatches and exports in August 2024
06 September 2024Pakistan: Recent tax increases on cement have been blamed for a significant decline in demand, with cement despatches falling by 25% in August 2024 compared to August 2023. According to the All Pakistan Cement Manufacturers Association (APCMA), total cement dispatches during August 2024 were 3.37Mt, down by 34% year-on-year from 4.53Mt.
For the first two months of the 2024 financial year, total cement despatches were 6.38Mt, a decline of 18% year-on-year from 7.76Mt in 2023. In August 2024, domestic dispatches decreased by 21% year-on-year to 5.21Mt, and exports dropped slightly by 2% to 1.16Mt.
A spokesperson for the APCMA said "In the current budget, excise duty on cement doubled, alongside significant increases in federal and provincial taxes," adding that no other industry has been taxed as heavily. "The government must reassess its taxation policies to support the struggling construction sector, which is critical for employment and economic stability."
Pakistan: Cement dispatches rose by 7.8% reaching 4.275Mt in May 2024 from 3.97Mt in May 2023. According to data from the All Pakistan Cement Manufacturers Association (APCMA), local sales fell by 2.2% to 3.36Mt, while exports increased by 72% to 0.91Mt. Over the first 11 months of the financial year, total dispatches were up 3% year-on-year to 41.7Mt. Domestic sales dropped 4% to 35Mt, but exports grew by 66% to 0.66Mt.
An APCMA spokesman said “It is a matter of serious concern that the cement sector continues to post negative growth in local dispatches for the ninth straight month. We are hopeful that the government will give due attention to the concerns of the cement industry in the upcoming budget. We have an almost one-third idle capacity which, if utilised, can bring our operational costs down and provide relief to end-consumers
Update on Pakistan, April 2024
24 April 2024Changes are underway in South Asia’s second largest cement sector, with two legal developments that affect the industry set in motion in the past week. At a national level, the Competition Commission of Pakistan recommended that the government require cement producers to include production and expiry dates on the labels of bagged cement. Meanwhile, in Pakistan’s largest province, Punjab, a new law tightened procedures around the establishment and expansion of cement plants. At the same time, the country’s cement producers began to publish their financial results for the first nine months of the 2024 financial year (FY2024).
During the nine-month period up to 31 March 2024, the Pakistani cement industry sold 34.5Mt of cement, up by 3% year-on-year. Producers have responded to the growth with capacity expansions, including the launch of the new 1.3Mt/yr Line 3 of Attock Cement’s Hub cement plant in Balochistan on 17 April 2023. China-based contractor Hefei Cement Research & Design executed the project, including installation of a Loesche LM 56.3+3 CS vertical roller mill, giving the Hub plant a new, expanded capacity of 3Mt/yr.
Pressure has eased on the operating costs of Pakistani cement production, as inflation slowed and the country received a new government in March 2024, following political unrest in 2022 and 2023. Coal prices also settled back to 2019 levels, after prolonged agitation. Pakistan Today News reported the value of future coal supply contracts as US$93/t for June 2024, down by 2% over six months from US$95/t for January 2024.
Nonetheless, cost optimisation remained a ‘strong focus’ in the growth strategy of Fauji Cement, which switched to using local and Afghan coal at its plants during the past nine months. Its reliance on captive power rose to 60% of consumption, thanks to its commissioning of new waste heat recovery and solar power capacity. During the first nine months of FY2024, the company’s year-on-year sales growth of 14% narrowly offset cost growth of 13%, leaving it with net profit growth of 1%.
Looking more closely, the latest sales data from the All Pakistan Cement Manufacturers Association (APCMA) shows a stark divergence within cement producers’ markets. While exports recorded 68% year-on-year growth to 5.1Mt, domestic sales fell, by 4% to 29.4Mt. The association further breaks down Pakistani cement sales data into South Pakistan (Balochistan and Sindh) and North Pakistan (all other regions). Domestic sales dropped most sharply in South Pakistan, by 6% to 5.16Mt. In the North, they dropped by 3% to 24.2Mt. Part of the reason was a high base of comparison, following flooding-related reconstruction work nationally during the 2023 financial year. Meanwhile, the government finished rolling out track-and-trace on all cement despatches during the opening months of the current financial year, and commenced the implementation of axle load requirements for cement trucks. APCMA flagged both policies as potentially disruptive to its members’ domestic deliveries, amid a strong infrastructure project pipeline.
Pakistani producers suffer from overcapacity, but have established themselves as an important force in the global export market. They continue to locate new markets, including the UK in January 2024. Lucky Cement was among leading exporters overall, with a large share of its orders originating from Africa.
On 17 April 2024, the government of Punjab province set up a committee to assess new proposed cement projects, with the ultimate goal of conserving water. Falling water tables are considered a significant economic threat in agricultural Punjab. Besides completing an inspection by the new committee, proposed projects must also secure clearance from six different provincial government departments and the local government. While acknowledging the necessity of the cement industry, the government insisted that it will take legal action against any cement plant that exceeds water allowances.
Pakistan’s cement plants have grown in anticipation of a local market boom. Without this strong core of sales, underutilisation will remain troublesome, especially in North Pakistan where exposure is highest. At the same time, APCMA has given expression to the perceived lack of support affecting production and distribution. For an industry with expansionist aims, new restrictions on its growth and operations can feel like an existential menace.
Pakistan: Local cement producers delivered 30.6Mt of cement to customers in Pakistan during the first nine months of the 2023 financial year, down by 15% year-on-year from 36.1Mt in the corresponding period of the 2022 financial year. The Dawn newspaper has reported that producers exported 3.04Mt of cement, 9% of total sales of 33.6Mt. Exports fell by 35% from 4.64Mt, while total sales fell by 18% from 40.8Mt.
The All Pakistan Cement Manufacturers Association (APCMA) said “Continued political instability, currency devaluation and poor economic conditions are badly affecting all the industrial sectors, including the cement industry.” It continued “Construction activities in both the northern and southern regions of the country have been declining significantly over past months. Employment opportunities for skilled and unskilled labour attached to the construction sector are also in decline.”
Pakistan’s cement dispatches fall in October 2022
07 November 2022Pakistan: Cement dispatches declined by 18.5% year-on-year across Pakistan in October 2022, according to data from the All Pakistan Cement Manufacturers’ Association (APCMA). Total cement dispatches during October 2022 were 4.25Mt, compared to 5.22Mt in October 2021. Local dispatches fell by 3.98Mt in October 2022 from 4.60Mt in October 2021, a fall of 15.5%. Exports fell by 40.7% from 611,000t in October 2021 to 362,000t in October 2022.
During the first four months of the current fiscal year, which began on 1 July 2022, Pakistan’s total cement dispatches - domestic and exports - were 13.9Mt, down by 23.1% from more than 18Mt during the corresponding period of the prior fiscal year. Domestic dispatches during this period were 12.5Mt against 15.9Mt a year earlier, a reduction of 21.4%. Exports were 36.0% lower than in the first four months of the 2021 - 22 fiscal year, falling to 1.38Mt.
Pakistan: The All Pakistan Cement Manufacturers Association (APCMA) has received a request from the Pakistan government to lower cement prices. The International News newspaper has reported that Finance and Revenue Minister Shaukat Tarin spoke with APCMA representatives about trends in cement pricing in the three years prior to August 2021 and the importance of cement in stimulating economic growth. Tarin encouraged the establishment of a consultative session between the association and relevant stakeholders, with the task of proposing a sustainable pricing mechanism.
APCMA’s Karachi offices searched in pricing probe
20 November 2020Pakistan: The Competition Commission of Pakistan (CCP) conducted a search and inspection of the Karachi offices of the All Pakistan Manufacturers Association (APCMA) on Thursday 19 November 2020. The search was carried out as part of an enquiry launched in May 2020 to investigate possible anti-competitive activities by cement producers. Two different CCP teams entered and searched the offices of the Chairman and Vice Chairman of APCMA and impounded relevant records.
The enquiry began based on the information gathered through various media reports and concerns expressed regarding a concurrent increase in cement prices across Pakistan, particularly during April 2020. The APCMA stands accused of orchestrating a price rise among producers.
The CCP previously searched and inspected the APCMA’s main offices in Lahore. That search allegedly led to the discovery of WhatsApp messages and emails that led investigators to believe there were grounds for further investigation.
Pakistan: Cement producers in Pakistan have increased volumes in the five months to 30 November 2019 by 5.8% year-on-year to 20.5Mt from 19.9Mt. This represents 82% utilisation of its 55.9Mt/yr capacity. Exports over the period were 3.61Mt, up by 22% year-on-year from 2.97Mt in the same period of 2018. The All Pakistan Cement Manufacturer Association (APCMA) released a statement lobbying the government to intervene in replacing bricks, the production of which it says causes smog in central Punjab, with concrete blocks. “Government should start work on announced housing projects that would have a positive impact on uptake of cement,” it said.
Pakistan: Business activity slowed during the month of Ramadan in Pakistan, with cement demand also affected. In May 2018, domestic cement sales were the slowest seen in the current fiscal year, which runs until the end of June 2018, yet they still rose by 2.4%. When exports, which rose by 41.8%, are also included, the year-on-year change rises to 5.7%.
The All Pakistan Cement Manufacturers’ Association (APCMA) reported that 3.92Mt of cement was sold in May 2018 compared to 3.71Mt in May 2017. Sales in the country's northern region stood at 2.81Mt, compared to 2.8Mt in May 2017. In the south, sales came to 0.67Mt in May 2017, as opposed to 0.59Mt in May 2017. Exports from the northern region were 0.224Mt in May 2018 compared to 0.219Mt in May 2017. From the southern region, exports totalled 0.215Mt compared to just 0.09Mt in May 2017.
Total cement sales in the first 11 months of the 2018 Fiscal Year hit a record high, with 42.92Mt sold, a 14.2% rise year-on-year compared to 37.6Mt in the first 11 months of the 2017 Fiscal Year. The APCMA reported that the national capacity utilisation rate over the 11 months period was 94.7%, beating the previous 93.6% record from 1992-1993.
An APCMA spokesperson said the association anticipated that domestic cement consumption would once again rise after Ramadan, while a continued increase in exports was a welcome sign for the industry. However, he said the major factor behind the rise in exports had been the decline in the value of the Pakistani Rupee against the US Dollar, which greatly improved the competitiveness of cement manufacturers in global markets.
Record July for Pakistan
07 August 2017Pakistan: The cement sector in Pakistan recorded an all-time high single month sales in July 2017 as the commodity's sales and exports grew by 44% year-on-year to 3.38Mt. The All Pakistan Cement Manufacturers Association (APCMA) said that sales and exports were 2.33Mt in July 2016. Domestic sales rose by 55% to 2.91Mt, while exports remained flat at 0.48Mt.
“The dispatch figures for July 2017 are most encouraging,” said an APCMA spokesman. “The industry has established a record for this month. Never before has the sector crossed the dispatch limit of 3Mt in July.” The spokesman added that the turnaround after a dismal performance in June 2017 had taken the industry by surprise and that the sharp increase in dispatches in July rekindled hopes for growth. “The dispatches were achieved despite political turmoil in the country and unprecedented rains throughout the country. This depicts the maturity of the construction sector in the country,” he said.
Exports to Afghanistan during the month increased by 40.3% year-on-year to 210,000t but this was off-set by a large fall in exports to India and elsewhere. Sales to India fell by 11.6% to 122,000t and to other countries sales fell by 19.0% to 144,000t.