ISLAMABAD: Pakistan’s cement sector is showing signs of recovery in FY26 despite growing uncertainty in the global macroeconomic environment. The industry’s performance in the first nine months reflects a strong domestic turnaround, shifting away from heavy reliance on exports.
As of early April 2026, cement prices in Pakistan remain high:
Total cement offtake during 9MFY26 recorded a 10% increase, primarily fueled by an 11% surge in local demand, while exports contributed a modest 6%. This shift toward the domestic market has supported profitability, as manufacturers enjoy better pricing power locally compared to competitive international markets.
Despite improving demand, the industry continues to face a capacity overhang. Average domestic monthly demand has climbed to around 3.9 million tons, recovering from the seven-year low in FY25. However, total production capacity has expanded to nearly 65 million tons, marking a 22% increase since FY21.
As a result, capacity utilization remains below 60%, indicating that supply still significantly exceeds demand.
Ongoing cross-border tensions with Afghanistan are further complicating export routes, increasing reliance on the domestic market. Although government-backed mortgage subsidies aim to support construction activity, rising costs may discourage potential homebuyers.
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