06-06-2009, 07:24 AM
By Moonis Ahmed
KARACHI: The cement exports were unexpectedly high at 1.17 million tonnes in May-09, up 16 percent month-on-month (MoM) and 37 percent year-on-year (YoY), the latest numbers released by All Pakistan Cement Manufactures Association said.
According to the latest numbers released, the region-wise export suggests that growth is broad-based. On the back of robust exports, overall cement sales volumes rose by 2 percent YoY (+5 percent MoM) in May-09. However, exports since January-09 to date up 50 percent YoY to 10.10 million tonnes.
Region-wise export data suggests that the growth is broad-based across the key markets of Afghanistan (25 percent share), the Middle East (45 percent share) and Africa (12 percent share) while Indian exports lag (7 percent share).
The demand from UAE is expected to continue and much of the Middle East to contract sharply, possible upside to FY10 exports is contingent upon the relatively new markets of Africa and Iraq which now claim a joint 17 percent share of Pak exports and where export volumes have more than doubled relative to a year ago, an analyst said.
Domestic demand meanwhile remains weak where sales dropped by 14 percent YoY (-1 percent MoM) to 1.65 million tonnes in May-09. Higher infrastructure spend in FY10, a possible uptick in govt development spending (PSDP) in the 13th June budget and demand from dams, could be the key upside variable on the domestic front, analyst said.
The time-lag between PSDP allocation and actual cement demand is 6-9 months while the lag for demand for dam construction may be longer yet.
Retail domestic cement prices (Rs 347 per bag) remained unchanged in May-09 amid low construction activity. It is notable that if a proposed 20 to 25 percent cut in excise duty comes through, Rs 10 to Rs 13 per bag could be drop in retail prices come July with no meaningful impact on margins.
Coal prices were also subdued hovering around $64 per tonne. While oil prices have strengthened in the past month on back of OPEC cuts and expansive fiscal and monetary policies, coal prices have lagged as global supply pressure has eased in the face of flat demand.
Lucky Cement’s (LUCK) total volumes grew by 4 percent YoY to 5.25 million tonnes in 11MFY09. Local dispatches of the company declined by 16 percent YoY to 2.21 million tonnes, as it mirrored the overall industry’s decline.
D.G.Khan Cement’s (DGKC) total volumes declined by 13 percent YoY to 3.50 million tonnes in 11MFY09. In the domestic market, the company’s market share got slashed to 12 percent in 11MFY09 from 16 percent in 11MFY08.
Bestway Cement (BWCL) recorded 28 percent YoY growth in volumes in 11MFY09 on the back of 8 percent YoY growth in local dispatches, and a 119 percent YoY increase in exports.
http://www.dailytimes.com.pk/default.asp...009_pg5_12
KARACHI: The cement exports were unexpectedly high at 1.17 million tonnes in May-09, up 16 percent month-on-month (MoM) and 37 percent year-on-year (YoY), the latest numbers released by All Pakistan Cement Manufactures Association said.
According to the latest numbers released, the region-wise export suggests that growth is broad-based. On the back of robust exports, overall cement sales volumes rose by 2 percent YoY (+5 percent MoM) in May-09. However, exports since January-09 to date up 50 percent YoY to 10.10 million tonnes.
Region-wise export data suggests that the growth is broad-based across the key markets of Afghanistan (25 percent share), the Middle East (45 percent share) and Africa (12 percent share) while Indian exports lag (7 percent share).
The demand from UAE is expected to continue and much of the Middle East to contract sharply, possible upside to FY10 exports is contingent upon the relatively new markets of Africa and Iraq which now claim a joint 17 percent share of Pak exports and where export volumes have more than doubled relative to a year ago, an analyst said.
Domestic demand meanwhile remains weak where sales dropped by 14 percent YoY (-1 percent MoM) to 1.65 million tonnes in May-09. Higher infrastructure spend in FY10, a possible uptick in govt development spending (PSDP) in the 13th June budget and demand from dams, could be the key upside variable on the domestic front, analyst said.
The time-lag between PSDP allocation and actual cement demand is 6-9 months while the lag for demand for dam construction may be longer yet.
Retail domestic cement prices (Rs 347 per bag) remained unchanged in May-09 amid low construction activity. It is notable that if a proposed 20 to 25 percent cut in excise duty comes through, Rs 10 to Rs 13 per bag could be drop in retail prices come July with no meaningful impact on margins.
Coal prices were also subdued hovering around $64 per tonne. While oil prices have strengthened in the past month on back of OPEC cuts and expansive fiscal and monetary policies, coal prices have lagged as global supply pressure has eased in the face of flat demand.
Lucky Cement’s (LUCK) total volumes grew by 4 percent YoY to 5.25 million tonnes in 11MFY09. Local dispatches of the company declined by 16 percent YoY to 2.21 million tonnes, as it mirrored the overall industry’s decline.
D.G.Khan Cement’s (DGKC) total volumes declined by 13 percent YoY to 3.50 million tonnes in 11MFY09. In the domestic market, the company’s market share got slashed to 12 percent in 11MFY09 from 16 percent in 11MFY08.
Bestway Cement (BWCL) recorded 28 percent YoY growth in volumes in 11MFY09 on the back of 8 percent YoY growth in local dispatches, and a 119 percent YoY increase in exports.
http://www.dailytimes.com.pk/default.asp...009_pg5_12