LAHORE  - The cement rates in the domestic market continue their upward march, registering a rise of at least 4 per cent or Rs20 per 50 kg bag during last 5 months since the start of FY2013-14, with further increase still to come.

Though much of the price rise was to pass on the impact of increased GST, change in GST regime and rising power tariff, the hike is contributing towards strengthening margins of the cement manufacturers, especially ones having gas-based power generation, including Lucky, DG Khan and Maple Leaf Cement companies, Industry experts from AHL observed on Wednesday in a report.

According to them, once having crossed $90/ton mark for a brief period back in October 2013, coal in the global market has stabilized around $83/ton, while the average has clocked in at $76/ton since July 2013 to date. Even though prevailing coal prices stay higher than the period average, it is pertinent to mention that, on annual basis, coal prices are still considerably down 12% against last year same period.

Meanwhile, industry sources suggest that sales during 5MFY14 are likely to be around 12.9-13.0m tons. In 5MFY14, sector’s dispatches are likely to be flat as compared to same period last year.  Salman Badami from Topline stated that local dispatches in 5MFY14 are likely to stand stagnant at 9.5m tons as compared to the same period last year, while exports are likely to decline by 4% to 3.5m tons. Nov 2013 dispatches will be 2.6-2.65m tons, however, sales are stagnant not only when compared with previous month but against same period last year as well.