LAHORE  -  The growth in cement export by sea has increased by 133.71 percent from 0.144 million tons in July 2017 to 0.34 million tons in July 2018 to other countries which offset the decrease of exports to Afghanistan and India.

Its export to Afghanistan and India decreased by around 44.88 percent and 44.43 percent respectively in the same duration. Hence, the overall exports have increased by 9.25 percent in July 2018 to 0.53 million tons from 0.48 million tons in corresponding period of last year. The industry experts said that the growth in exports is consistent but is higher due to smaller base of exports. They said that the most pleasing aspect of recent surge in cement sector is the resurgence of exports that had been going down during 2008-2017 periods but has started recovering steadily for the last few months and the trend continued in July 2018.

They expressed hope that after the induction of new government the economic activities would grow and the cement demand would increase.

It is expected the new economic managers to make the necessary changes in policy that the industry has been demanding to further boost demand, and also take measures to boost export opportunities in neighboring countries.

Experts said that exports are changing gears, as following fresh supply addition of 7.25m tons in 2HFY18 by four players, industry exports have expectedly shifted its course. The downtrend in cement exports seen in past eight years have effectively reversed since 2HFY18 as existing players shifted their focus on optimal utilization of new capacities while taking a slight hit on margins (margins on exports stands around $15/ton compared to $20/ton on local sales). To this end, recent rounds of Rupee devaluation (20 percent since Dec 2017) proved to be a boon for cement industry (particularly South-based players).

 During Jul 2018, the South region outperformed North region. Moreover, an interesting trend also seems to be emerging, where pick-up in bulk clinker exports was witnessed in Jul 2018 by almost all leading cement exporters in South region (100,000 tons clinker exported each by LUCK and ACPL during Jul 2018). With 2.8m tons fresh capacity addition, it is expected DGKC will soon join the bandwagon to achieve fixed cost break-even. Experts suggest that the company already have 1-1.5m tons export orders in hand, which it may exploit.

Earlier, cement sales posted a growth of five per cent in the first month of 2018-19. In July, total cement despatches were recorded at 3.554 million tonnes, up 5.10pc from 3.382m tonnes in the corresponding period of last year.

In the wake of elections, economic and construction activities slowed down as workers returned to their homes to cast vote but it did not seriously affect the sales growth, spokesman of All Pakistan Cement Manufacturers Association (APCMA) said.