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Pakistan's Cement Industry: Challenging Times and Hopeful Prospects in FY22-23

By Syeda Rida Shammas

The cement industry in Pakistan faced significant challenges during FY22-23, with negative growth in exports attributed to soaring international coal prices. However, the industry witnessed a recovery in the latter half of the fiscal year as coal prices eased, leading to a positive forecast for FY23-24. In this blog, we will delve into the factors contributing to the decline in exports and explore the opportunities that lie ahead for Pakistan's cement industry. Additionally, we will examine the impact of cement prices in Pakistan and the latest cement rates while discussing the overall performance of the cement industry in Pakistan.

FY22-23 Export Performance

In FY22-23, the cement industry in Pakistan experienced a contraction in export earnings and volumes. The export earnings amounted to US$190 million, representing a decline of 15.2% from the previous year's US$224 million. Similarly, cement and clinker exports declined by 25.9%, falling from 5.733 million tons to 4.248 million tons. The main contributing factor to this decline was the surge in international coal prices, which made cement exports economically unviable initially.

Recovery in the Latter Half of FY22-23

As international coal prices eased in 2HFY22-23, dropping to approximately US$132/t, the cement industry in Pakistan experienced a significant recovery. Exports rebounded, showing a 52% YoY volumetric growth compared to the previous year, offsetting some of the losses incurred in 1HFY22-23. Notably, global cement and clinker prices remained stable throughout this period.

Positive Forecasts for FY23-24

AHL Research has released an optimistic forecast for Pakistan's cement industry in FY23-24. The outlook is driven by expectations of a recovery in cement demand, primarily due to a substantial decline in coal prices. Additionally, energy efficiencies and higher retention prices are projected to stimulate the industry's bottom line, paving the way for growth in the coming fiscal year.

Impact of Cement Prices in Pakistan

Amidst the challenges faced by the cement industry, the issue of cement prices in Pakistan has been a focal point for consumers and stakeholders. As international coal prices fluctuated, cement manufacturers faced cost pressures, which influenced local cement prices. During FY22-23, cement prices might have experienced variations based on these cost factors.

Understanding Cement Rate Today

The cement rate today refers to the current market price of cement in Pakistan. This rate can be influenced by factors such as supply and demand dynamics, production costs, changes in coal prices, and economic conditions. As the industry recovered in the latter half of FY22-23, cement rates might have reflected the improving demand and cost adjustments.

Economic Outlook and Reforms

Despite the positive forecast for FY23-24, the cement industry in Pakistan and the country's economy still faces challenges, such as high inflation and the need for structural reforms. Inflation is projected to average around 21% in FY23-24, leading to monetary easing in the second half of the fiscal year. With the upcoming election, the new government is expected to prioritize major structural reforms in line with the larger IMF program.

External Factors Driving Growth

Pakistan's economic situation is expected to improve, thanks to financial cooperation from Saudi Arabia, China, UAE, and other donors. The IMF program has provided clarity and assurance for the economic plan, with US$3 billion in three installments, the first of which has already been released. This injection of funds is expected to alleviate external sector pressures, leading to an increase in State Bank (SBP) reserves to US$10.6 billion by FY23-24.


The cement industry in Pakistan experienced a challenging FY22-23 due to unfavorable international coal prices, resulting in a decline in export earnings and volumes. However, as coal prices eased, the industry showed signs of recovery in the latter half of the fiscal year. The positive forecast for FY23-24 indicates growth opportunities, supported by declining coal prices, energy efficiencies, and higher retention prices. As the nation prepares for structural reforms and monetary easing, the cement industry in Pakistan looks forward to better prospects in the future. Monitoring cement prices in Pakistan and the latest cement rates will play a crucial role in gauging the industry's performance in the coming fiscal year. With economic conditions improving and the government's commitment to reforms, Pakistan's cement industry is poised to navigate challenges and embrace growth in FY23-24.

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