Cement sales and exports set new records

* Exports of 726,000 tonnes, 1.9 million tonnes local sales of cement during March are the highest in Pakistani history

By Muhammad Yasir

KARACHI: Cement’s monthly sales and exports have marked a new record in the country’s history, breaking all the previous record levels this month to reach at 2.61 million tonnes and 726,000 tonnes respectively.

The record sale of cement was marked on the back of record-breaking exports of 726,000 tonnes (previous record was 645,000 tonnes in February 2008) and 1.9 million tonnes local sales (also close to its record for a single month), a report prepared by JS Capital Research said. The sales of cement during March 2008 had already broken the previous monthly record of 2.56 million tonnes (November 2007) to reach at 2.61 million tonnes by the March 25, 2008.

However, cement manufacturers estimated that the total sales for March 2008 would reach 3.2 million tonnes including local sales of 2.3 million tonnes and exports of 903,000 tonnes.

Keeping in view the first 25-day sales of March 2008, the total cement dispatches in March 2008 are expected to reach at 3.2 million tonnes. This would translate into a significant growth of 42 percent on year-on year basis and 30 percent on month-on-month basis.

Exports, which have already broken the monthly record of 645,000 tonnes set in Feb 2008, are believed to exceed 900,000 tonnes registering a whopping growth of 143 percent on year-on-year basis and 40 percent on month-on-month basis. While local sales, which made a record of 2 million tonnes in November 2007 are likely to reach at 2.3 million tonnes in March 2008.

An analyst of the cement sector Bilal Hameed told Daily Times here Friday that upbeat cement dispatches during this period is a normal phenomenon since it marks the start of peak demand season. Winter season has ended and upbeat construction activities, both in the local and the exports market, are on the roll, he added.

He said that the primary source of overall cement growth in fiscal year 2007-08, however, will be exports owing to the supply shortage in India and Middle East, which led to rocketing cement prices in the region. Pakistani cement companies, due to their excess capacity, are looking to export to neighboring countries such as Middle East, Africa, Afghanistan and India where they are getting a price premium.

Meanwhile, Pakistani cement exports have surged to United Arab Emirates (UAE) after its government had removed 5 percent customs duty on cement to help the fast moving construction sector in Dubai.

As far as prices of foreign countries are concerned, the increasing regional cement price is benefiting Pakistani cement companies that are able to export their products at a price premium. Initially, cement was being exported to the UAE at FOB (Free on Board) price of US$60-65 per tonne, which has now jumped to US$70-75 per tonne.

The cement’s demand has been rising as the construction season has began in a full swing locally and in the exporting countries in March that is expected to increase manifold in the remaining months of the current fiscal year.

On the other hand, the prices in the local markets are also on the rise during the current peak season due to swelling demand.

According to the dealers, local cement manufacturers have increased ex-factory cement prices by Rs 15-20 per bag during the last week across the country. With this rise, the average ex-factory cement price stands at Rs 265-270 per bag in Karachi and southern parts of the country while it stands at Rs 247-252/bag in north.

However, dealers said that manufacturing companies have been increasing cement prices by Rs 10-5 per bag for last two weeks in the peak sales season of the construction.

http://www.dailytimes.com.pk/default.asp?p...29-3-2008_pg5_2

Hope these companies stay updated to the current trends and do their utmost to reduce their expenditures.

There are many cement factories in south east asia that have built their own waste management plants and generate electricity.

India mulls more cement imports from Pakistan

Tuesday, April 08, 2008
NEW DELHI: India will look at importing more cement from Pakistan to check spiraling domestic prices, as a neighbouring country has surplus production this year, a top official in the Industry Ministry said.

“We are looking at importing more cement from Pakistan through north western border,” Ajay Shankar, secretary in the Department of Industrial Policy & Promotion, said. “We are watching the situation very carefully,” Shankar said, referring to internal monitoring of some commodity prices to act if their prices go out of control.

“Capacity expansion is taking place and we expect demand-supply situation to balance this year,” he said, referring to the plan to enhance cement capacity by 118 million tonnes over the next four years to touch 298 million tonnes.

State-run canalising agency Minerals & Metals Trading Corp could be asked to import cement from Pakistan at around Rs210-Rs220 per 50-kg bag, against the domestic price of over Rs230.

http://www.thenews.com.pk/daily_detail.asp?id=105449

I heard that Egypt has restricted its cement production. It was a major supplier to UAE and now UAE is meeting the shortfall by buying from Pakistan. If you see the KSE Cement sector was performing good lately (haven't seen index in couple of days) This news of Egypt was taken as a healthy sign in market and it is expected that production of cement will raise as well as the stock prices of cement manufacturers.
One more thing is sighted that local cement prices will raise too although there is increase in production. mainly because manufacturers are sighting exports rather then to supply in local markets.

Cement exports to Middle East and African countries rise by 80%

By Muhammad Yasir

KARACHI: High demand of Pakistan’s cement in the Middle East and African countries has enhanced significantly country’s exports by 80 percent in the three quarters of the current fiscal year to stand at 2.632 million tonnes.

According to the All Pakistan Cement Manufacturer Association (APCMA), the cement exports have registered 139 percent growth to reach at 5.1 million tonnes so far in the fiscal year with the rising construction boom in Middle East, African countries, and India.

The cement exports to Middle East and African countries were recorded 1.463 million tonnes in three quarters of previous fiscal year.

However, exports to Afghanistan have registered 34.7 percent growth with 2.067 million tonnes in the three quarters of the current fiscal year as compared to 1.72 million tonnes during same period of last fiscal year.

Pakistani cement exports have surged to United Arab Emirates (UAE) after its government removed 5 percent custom duty on cement to help the fast moving construction sector in Dubai, it is learnt.

As far as prices of foreign countries are concerned, the increasing regional cement price is benefiting Pakistani cement companies who are able to export cement at a price premium. Initially, cement was being exported to UAE at FOB price of $60 to $65 per tones, which has now jumped to $70 to $75 per tonne.

Cement demand has been rising as the construction season began in a full swing locally and in the exporting countries in March.

http://www.dailytimes.com.pk/default.asp?p...15-4-2008_pg5_4