Cement sales decline by 6.6% construction activities remain sluggish
April 06, 2025
Cement sales decline by 6.6%, construction activities remain sluggish
Cement Sales Decline by 6.6%, Construction Activities Remain Sluggish
By Right News Desk
The domestic cement industry continues to struggle as sales dropped by 6.6% year-on-year in March 2025, highlighting persistent challenges faced by Pakistan’s construction sector. According to data released by the All Pakistan Cement Manufacturers Association (APCMA), total cement dispatches — including both domestic and export sales — stood at 3.94 million tons in March 2025, compared to 4.22 million tons in the same month last year.
Domestic Market Still Under Pressure
Domestic sales declined to 3.27 million tons from 3.49 million tons in March 2024, showing a year-on-year contraction of 6.3%. The dip has been attributed to sluggish construction activity across both public and private sectors. Ongoing economic challenges, high-interest rates, inflationary pressures, and limited development spending by the government have significantly dampened demand.
Industry experts point out that investor confidence in real estate and infrastructure projects remains low, which directly affects the demand for construction materials such as cement, steel, and bricks.
Export Markets Also Weak
Cement exports also took a hit, declining by 8.2% year-on-year to 673,000 tons in March 2025 from 732,000 tons in March 2024. While some manufacturers had hoped to make up for domestic losses by ramping up exports, global shipping costs and geopolitical uncertainties have limited that potential.
Exports to traditional markets like Afghanistan, Sri Lanka, and East Africa have slowed down due to weaker regional demand and competition from other low-cost cement producers.
Industry-wide Concerns
The overall performance of the cement industry during the first nine months of FY2024-25 paints a similar picture. Cumulative dispatches during July 2024 to March 2025 stood at 34.1 million tons — a decline of 4.5% from the 35.7 million tons recorded in the same period of the previous fiscal year.
North-based cement mills dispatched 2.76 million tons domestically in March 2025, down from 2.91 million tons last year. South-based mills fared no better, with domestic sales dipping to 510,000 tons from 577,000 tons in March 2024. Exports from the South dropped by 7.6% during the month.
An APCMA spokesperson stated, “The industry is under stress from both falling demand and rising input costs. The price of coal, energy tariffs, and logistical expenses continue to climb, further squeezing margins.”
Government Projects on Hold
Construction of several public-sector development projects has slowed or halted due to budgetary constraints and delays in fund disbursement. The Public Sector Development Programme (PSDP) has seen a reduction in actual spending compared to allocations, largely due to fiscal tightening by the government as it aims to meet IMF targets.
Private sector activity is also lagging due to higher financing costs and reduced consumer purchasing power. Developers are holding back on launching new housing schemes, and existing projects are progressing at a slower pace than usual.
Outlook Remains Uncertain
Industry watchers suggest that unless there is a significant policy intervention — such as subsidized financing for the construction sector or increased public spending — the cement industry may continue to face headwinds in the coming quarters.
However, some optimism remains. If economic indicators begin to stabilize and the government resumes infrastructure spending ahead of the next budget, a modest recovery could emerge in the second half of 2025.
In the meantime, cement manufacturers are calling for tax relief, lower energy tariffs, and support for exports to help navigate the difficult landscape.
Conclusion
The 6.6% decline in cement sales reflects deeper issues in Pakistan’s economy and its construction sector. Without a boost in infrastructure investment and housing activity, the demand for cement is unlikely to rebound strongly in the near term. For now, the industry is in wait-and-watch mode — hoping for better days ahead.
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