Pakistan’s cement industry saw a fall of 2.12% in dispatches during Nov 2023, when total cement dispatches reached 3.924 million tons against 4.009 Million Tons dispatched during the same month of last fiscal year. Industry experts have predicted that cement dispatches could be declined due to axle load, which has hampered cement transportation. Out of this total, according to the data released by the All Pakistan Cement Manufacturers Association (APCMA), local cement dispatches by the industry during November 2023 were 3.262 million tons compared to 3.862 million tons in November 2022, showing a decline of 15.53%. Exports dispatch, however, increased by a massive 348.29% as the volumes increased from 147,757 tons in November 2022 to 662,374 tons in November 2023.

In November 2023, North-based cement mills dispatched 2.867 million tons of cement, showing a decline of 12.24% against 3.267 million tons of dispatches in November 2022. South-based mills shipped 1.057 million tons of cement during November 2023, 42.44% more than the dispatches of 0.742 million tons in November 2022. North-based cement mills posted 2.723 million tons of cement in domestic markets in November 2023, showing a decline of 13.91% against 3.163 million tons of dispatches in November 2022. South-based mills dispatched 538,668 tons of cement in local markets during November 2023, which was 22.85% less than the dispatches of 698,225 during November 2022.

Exports from North-based mills increased by 38.64% as the quantities rose from 103,824 tons in November 2022 to 143,942 tons in November 2023. Exports from the South also massively increased by 1080% to 518,432 tons in November 2023 from 43,933 tons during the same month last year.

In the first five months of the current fiscal year, total cement dispatches (domestic and exports) were 19.816 million tons, which is 10.81% higher than the 17.883 million tons dispatched during the corresponding period of the last fiscal year. Domestic dispatches during this period were 16.688 million tons compared to 16.354 million tons during the previous year, showing an increase of 2.04%. Export dispatches were also 104.60% more as the volumes increased to 3.129 million tons during the first five months of the current fiscal year compared to 1.529 million tons of exports during the last fiscal year.

North-based Mills dispatched 13.836 million tons of cement domestically during the first five months of the current fiscal year, showing an increase of 2% to cement dispatches of 13.566 million tons during July-November 2022. Exports from the North increased by 32.76% to 695,206 tons during July-November 2023 compared with 523,647 tons exported during the same period last year. Total dispatches by North-based Mills increased by 3.14% to 14.532 million tons during the first five months of the current financial year from 14.089 million tons during the last financial year.

Domestic dispatches by South-based Mills during July-November 2023 were 2.851 million tons, showing an increase of 2.26% over 2.788 million tons of cement dispatched last fiscal year. Exports from the South also increased by 142.01% to 2.433 million tons during July-November 2023 compared with 1.006 million tons exported during the same period last year. Total dispatches by South-based Mills increased by 39.30% to 5.284 million tons during the first five months of the current financial year from 3.794 million tons during the last financial year.

APCMA comments

A spokesman of the All Pakistan Cement Manufacturers Association mentioned that some sources had implemented the axle load regime since 1st Nov. 2023 without any consultation with stakeholders. Massively increasing freight charges on cement, coal, and other raw materials will increase. It will add unnecessary pressure on our inflation, which can increase by double digits. We want to suggest to the government that axle load be implemented in a phased manner over the next two to three years. We also foresee a major shortage of trucks, which will disturb the market supply. Exports will also be affected by this axle load regime, he added.