LAHORE - Keeping in view the stuttering local demand, some cement companies situated in the north region, consisting of Punjab and KP, have slashed their prices by up to Rs200/ton in order to induce demand. However, once the demand starts to pick up the manufacturers will bring the prices to their prior levels if not above it, industry sources said.

The holy month of Ramadan falling in July couple with monsoon season (especially in north) slowing down construction activities in the country can be cited as the prime reason behind the aforementioned sales performance.

They said that local sale of the cement for the month of July, 2013 remained depressed. They estimated that local sales have come down 14% to 1.9 million tons, while exports was up 8% to 725k tons. Resultantly, cumulative dispatches of the cement sector are likely to reach 2.6 million tons for July, which will be a low of 11 months. Furthermore, this depressed sales performance has also forced some manufacturers in the north region to slash their prices so that demand can be induced.

According to industry experts, FY14 kicked off on a depressed note as local dispatches remained sluggish.

Asad I. Siddiqui, an industry expert at Topline, believes, July dispatches will be down 14% to 1.9m tons (61k tons per day) as against 2.2m tons (73k tons per day) in the previous month. In addition to that, July 2013 local dispatches are down 5% when compared to same period last year. Local dispatches recorded in July will be the lowest of 9 months beating the previous low of 1.8mn tons in September.