Cement Prices in Pakistan Up 14pc in a Year, Raising Construction Costs
Cement Prices in Pakistan Up 14pc in a Year, Raising Construction Costs
The price of a 50kg bag of cement in Pakistan has risen by Rs201 over the past year, adding to construction costs, according to data from the Pakistan Bureau of Statistics (PBS).
The bureau's weekly Sensitive Price Index (SPI) for the week ending October 8 put the average price of a bag at Rs1,596. A year earlier, in the week ended October 9, 2025, it stood at Rs1,395. That works out to a year-on-year increase of 14.38 per cent.
Higher fuel costs cited
Topline Securities, in a report issued on Thursday, said cement prices rose by Rs100 to Rs150 per 50kg bag in the first quarter of FY27 compared with the same period last year. It attributed the increase mainly to higher fuel costs, driven by elevated international coal and diesel prices.
Adeel Ashraf of Topline Securities said Richards Bay coal averaged about $113.93 per tonne in 1QFY27. That compares with $113.20 in the previous quarter and $90.30 in the first quarter of FY26. Market sources put the year-on-year rise at around $20 per tonne. Including freight, they said, the average cost reached $133 per tonne, up from $113 a year earlier.
According to the sources, the $20 increase in coal costs added at least Rs20 to the cost of each bag, while higher diesel prices added around Rs15. Market sources also said cement prices in Punjab were higher than those in Karachi.
Sources question the size of the increase
The same sources said the overall rise in cement prices had widened manufacturers' margins and could lead to substantially higher profits in FY27. In their view, the cost increases justified a price rise of only Rs50 to Rs70 per bag.
They warned that higher cement prices would put further pressure on ordinary citizens already struggling to afford homes and flats. They said property investors continued to drive demand for housing projects, while houses and apartments remained out of reach for many ordinary buyers.
The sources also criticised regulators, saying they had failed to address the issue effectively. They noted that the Competition Appellate Tribunal has yet to decide a 2008 case involving alleged cement cartelisation, 18 years after it began.
Sector profits expected to rise
Topline Securities expects the listed cement sector to post a combined profit of Rs32.4 billion in 1QFY27, up from Rs27.8 billion in the same quarter last year. That is an increase of 16 per cent year-on-year and 16 per cent quarter-on-quarter. Mr Ashraf said the annual growth was mainly due to higher net sales amid increased retention prices.
Net sales are projected at Rs143 billion, up 25 per cent from a year earlier and 14 per cent from the previous quarter. Higher prices and stronger domestic dispatches are behind the projected rise.
Local cement dispatches grew 8 per cent year-on-year in the quarter, while export dispatches fell 11 per cent. Compared with the previous quarter, domestic dispatches rose 9 per cent on stronger demand and exports rose 10 per cent.