LAHORE - The cement off-take in September hit the 21 month low, going down by 22 per cent to 2 million tonnes. Expert termed it the largest annual decline since April 2001 owing to passive domestic demand in the aftermath of the recent flash floods. Similarly, on a month on month basis, sales were also down by 16 per cent as reduced business activity in the month of Ramadan also took its toll. Hence, dispatches for 1QFY11 stood at 6.9mn tonnes, 18% lower from the corresponding period last year. Analysts expect demand to pick up post 1HFY11, albeit slowly, with reversal in the current trend gathering pace from FY12 and beyond as reconstruction activities take shape. Local off-take has witnessed a bruising start to FY11, down 16%YoY in the 1Q owing to factors ranging from the recent flash floods to poor law and order situation. In September alone, dispatches were down 21%YoY to 1.4mn tons. On a month on month basis, due to Ramadan, sales were down 7%; largely in line with its 10 year average decline of 12%. Similar to local off-take, exports during the 1QFY11 were down 21%YoY to 2.3mn tons but for different reasons. Due to the commissioning of regional capacities, international prices have fallen to unattractive levels for local cement manufacturers to consider exporting, particularly those placed in the North of the country. Moreover, with the inland freight subsidy unavailable to manufacturers, export sales were 18% lower in 1Q, when compared to the previous quarter. Taking into consideration the 1Q scenario, Atif Zafar, an expert, has revised down local demand assumption to 23.2mn tons, a potential decline of 2% from last year. Though he believes local volumes have touched its trough in September, he eyes reversal of the current trend to gather pace from FY12 and onwards. On the export front, he remains less optimistic and anticipate sales to be in the vicinity of 9.7mn tons, down 9% from the previous year. Overall, industry volumes should be 4% lower from last year, he added.