LAHORE-The impact of the construction package announced by the government is yet to be seen as the domestic cement uptake declined by a massive 37.63 percent to 2.27 million tonnes in May 2020 from 3.64 million tonnes in May 2019, third double digit monthly decline this fiscal.

Moreover, exports also decreased by 24.81 percent from 0.483 million tonnes in May 2019 to 0.363 million tonnes in May 2020.

According to the data released by All Pakistan Cement Manufacturers Association (APCMA), cement dispatches were only 2.63 million tonnes in May 2020 for both export and local consumption against the disptaches of 4.12 million tonnes during the corresponding month of last fiscal, which shows a decrease of 36.12 percent. The decline in cement dispatches is mainly due to holy month of Ramzzan, Covid-19 and Eid holidays which slows the construction activity.

The domestic cement consumption in the North was 2.001 million tonnes against 3.05 million tonnes in May 2019. The consumption in the Southern zone of the country declined to 0.269 million tonnes from 0.589 million tonnes in May 2019. In the same way the exports from the North declined to 7,520 tonnes this May compared with 0.164 million tonnes last May. From the South, which is the hub of cement exports, there was a nominal increase from 0.319 million tonnes in May 2019 to 0.356 million tonnes in May 2020.

During the first 11 months of this fiscal the total cement dispatches were 43.189 million tonnes against 43.327 million tonnes during the same period last fiscal posting a decline of 0.32 percent. The domestic consumption during the first 11 months of this fiscal declined by 2.72 percent. Cement dispatches declined to 36.13 million tonnes in current fiscal from 37.14 million tonnes in corresponding period. While exports increased by 14.07 percent, export dispatches increased to 7.059 million tonnes during 11 months of current fiscal from 6.188 million tonnes in the corresponding period last year.

Domestic dispatches by the North based mills stood at 30.94 million tonnes during July-My 2019-20 against 29.61 million tonnes during the same period last year, posting a less than anticipated growth of 4.49 percent. However, exports from the region during the period under review declined by 19.24 percent, dropping from 2.38 million tonnes to just 1.924 million tonnes.

The South based mills dispatched 5.18 million tonnes cement locally during the first 11 months of this fiscal, declining by 31.09 percent from 7.53 million tonnes during the same period last year. Exports, however, registered a healthy increase of 34.92 percent, going up from 3.81 million tonnes to 5.13 million tonnes during the period under review.

“The cement sector has been in dire state for the last few months. It posted a growth of 31 percent in domestic cement consumption in February this year and after that the decline has been consistent, being 16.69 percent in March, 18.97 percent April and now almost double in May,” said the spokesperson of APCMA.

“The progress on the export front has also been gloomy as it posted a growth of over 48 percent in February; which declined to 5.67 percent in March; posted a massive decline of 56.60 percent in April and 24.81 percent in May,” he added.

“The negative growth is due to covid-19 impact and the delay in implementing public sector development projects,” said the spokesperson.

“The government should realize that the construction sector is the largest provider of employment to the unskilled workforce in Pakistan and decline in cement consumption means low construction activities and substantial increase in unemployment in the country,” he added.