Cement despatches decline by 6.81pc in July

LAHORE: The cement industry continued to face headwinds, with overall despatches falling by 6.81 per cent in July compared to the same period last year.

Cement despatches were 3.01 million tonnes against the 3.23 million tonnes despatched during the same month last year.

According to data released by the All Pakistan Cement Manufacturers Association, local cement despatches by the industry during the month of July 2024 were 2.46 million tonnes compared to 2.78 million tonnes in July 2023, showing a decline of 11.41 per cent. On the exports side, despatches increased by 21.65 per cent as volumes jumped from 449,792 tonnes in July 2023 to 547,162 tonnes in July 2024.

In July 2024, north-based cement mills despatched 2.19 million tonnes of cement, showing a decline of 11.4 per cent against the 2.47 million tonnes despatches in July 2023. On the contrary, south-based mills despatched 817,799 tonnes cement during July 2024, which was 8.2 per cent more compared to the despatches of 755,824 tonnes during July 2023.

North-based cement mills despatched 2.09 million tonnes cement in domestic markets in July 2024, showing a decline of 11.01 per cent against the 2.35 million tonnes despatches in July 2023.

South-based mills despatched 369,557 tonnes cement in local markets during July 2024, which was also 13.62 per cent less compared to the despatches of 427,847 million tonnes during July 2023.

Exports from north-based mills declined by 18.79 per cent as the quantities reduced from 121,814 tonnes in July 2023 to 98,920 tonnes in July 2024. Exports from the south however increased by 36.67 per cent to 448,242 tonnes in July 2024 from 327,977 tons during the same month last year.

A spokesperson from the All Pakistan Cement Manufacturers Association emphasized that higher taxes and increased input costs are affecting the country’s cement sector. He added that this is the 11th straight month during which domestic despatches are showing a declining trend due to sluggish economic activity in the country. The cement industry urges the government to review its taxation policies to reduce the burden of heavy taxes on this important sector of the economy.

We support the government’s documentation drive but forcing small retailers to register in a complicated sales tax system and installing PoS is not likely to yield any additional sales tax revenue, he said, adding that since cement is a 3rd Schedule item, the entire sales tax on consumer price is already being paid by the manufacturer.