CEMENT EXPORT FACING DOWNWARD TREND

KANWAL SALEEM
(feedback@pgeconomist.com)

Dec 3 - 9, 2012

Overall despatches of cement for the month of October 2012 declined by 5.87-percent mainly due to a drastic cut of 20.59-percent in export of cement.

The country's cement industry despatched 2.767 million tonnes of cement in October 2012 that was 5.87-percent less than 2.939 million tonnes despatched in the corresponding month of 2011. In October 2012, the local cement despatches was 2.086 million tonnes, which were up by 0.19-percent as compared to 2.082 million tonnes despatched in October 2011.

Cement industry sources told PAGE that in the first four months of current fiscal the total cement despatches stood at 10.474 million tonnes, which was slightly higher than the total despatches of 10.436 million tonnes achieved during corresponding period of last year. The overall gain in despatches was only 0.37-percent. The capacity utilisation of the industry during July-October 2012 period stood at 70.19-percent. The cement exports continued their downward trend in October 2012 as well declining by a massive 20.59-percent from the exports achieved in October 2011.

During the period from July-October 2012, exports to Afghanistan declined by 9.46-percent to 1.634 million tonnes. The exports to India declined by 37.51-percent to 0.158 million tonnes and exports to other destinations through sea increased by 2.34-percent to 1.161 million tonnes.

All Pakistan Cement Manufacturers Association (APCMA) spokesperson said cement export to India is well below the expectation of the cement sector. After opening of land route it was expected that industry would be able to export more than 5 million tonnes cement to India. However, non-trade barriers are hurting cement exports.

On the other hand, cement export to India through Railways wagons has almost completely been halted as in the absence of adequate security measures for eliminating narcotic smuggling, the cement manufacturers preferred to discontinue sending dispatch through rail routes. Currently, cement is being exported to India through trucks only which remain under the exporters control before crossing the border, however, the trucks are accepted by Indian authorities in small number thus resulting in declining export dispatches.

It may be recalled that the Indian Customs seized 105-kg of heroin from Pakistani goods train Wagon No.66938 at Amritsar Railway Station in the first week of October while unloading Pakistani cement. The notable thing in this regard was that the seal of the wagon was properly seal when it reached on the Indian side of the border at Atari. However, its seal was broken when it reached Amritsar. This implies that the seal was broken on the Indian side. The Indian officials acknowledged this fact during the investigation. The cement manufacturers in Pakistan approached the Customs and the Railways to take stringent measures to curb this menace. Additional Collector Customs Lahore Region assured that the manufacturers that Customs will take measures to eliminate chances of narcotics sneaked in to cement consignments. He, however, said 105 kg narcotic seized by Indian Customs at Amritsar cannot be blamed on Pakistan as the wagon from which the drug was seized sealed when it crossed the border. The seal was broken inside the Indian border where the responsibility lies with Indian.

The spokesman for cement manufacturers APCMA said that since these episodes adversely affected cement exports the Pakistan Customs and the Pakistan Railways authorities had agreed to increase vigilance and take more stringent measures to eliminate the chances of drugs going into India through Wagah.