Staff Report:
Pakistan’s local cement dispatches are likely to increase by 3% month-over-month to reach 2.99 million tons in October 2024, though they are expected to decline by 9% year-over-year. This analysis is based on provisional data for the first 20 days, with local sales currently at 1.93 million tons.
The month-over-month increase in dispatches is attributed to seasonal recovery following the monsoon and government-led construction activity, particularly in the south. October 2024 sales are anticipated to surpass the average of 2.71 million tons from the first quarter of FY25.
Average daily domestic sales for the sector are projected to be 96.5k tons per day in October, down from 106k tons per day in October 2023.Fauji Cement 1QFY25 EPS Rises 24% YoY to Rs1.32
The year-over-year decline in local cement dispatches is driven by a slowdown in construction due to rising input costs, as well as significant increases in cement bag prices—24% in the north and 17% in the south, according to PBS data.
Despite a price increase of Rs65-75 due to elevated royalties in Punjab, no instances of intra-provincial dumping have been reported. Discussions are ongoing among stakeholders regarding royalty discrepancies in Punjab.
Exports are anticipated to rise by 15% month-over-month and 58% year-over-year in October 2024. DGKC’s exports are expected to increase by 14% month-over-month, while LUCK and ACPL are projected to grow by 12% and 35%, respectively.
Total cement sales in Pakistan for October 2024 are estimated to reach around 4.12 million tons, reflecting a 3% year-over-year increase and a 6% month-over-month rise.
Total cement capacity utilization in October 2024 is estimated at 60%, compared to 57% in September 2024 and 58% in October 2023.
For the first four months of FY25, total cement sales are projected to decline by approximately 9% year-over-year, with local sales expected to decrease by 17% year-over-year, while exports are anticipated to rise by 33% year-over-year.
The average retail price in October 2024 has decreased by 1% month-over-month in the north and remained flat in the south, according to the Pakistan Bureau of Statistics (PBS).
