"The growth in overall dispatches is attributed to the seven percent year-on-year upsurge in local dispatches as these reached 12.89 million tons in the 7MFY12 in comparison of the local dispatches of 12.03 million tons in the same period last year", analysts said.

According to the monthly sales, data released by All Pakistan Cement Manufacturers Association (APCMA) for 7MFY12 the local dispatches were higher in north zone by five percent to 10.48 million tons and in south zone up by 17 percent on year-on-year basis to 2.4 million tons.

However, the industry was seen struggling on exports front as the total export dispatches fell by a four percent on year-on-year basis to 5.05 million tons in 7MFY12 as compare to total export dispatches of 5.23 million tons in 7MFY11.

"The decline in export dispatches was owing to prolonged economic slowdown leading to lower construction activities at most of the importing channels as 20 percent on year-on-year basis decline was observed only in "through sea" segment of exports", Sarfraz Abbasi, an analyst at Summit Capital said.

On month-on-month basis, the local dispatches in January 2012 reported a decline of four percent to 1.95 million tons against local dispatches of 2.03 million tons recorded in the month of December 2011.

Similarly, export dispatches also posted a decline of nine percent on month-on-month basis to 649,000 tons in the month of January 2012 as against the export dispatches of 649,000 tons in the previous month primarily because of the seasonal impact as cement dispatches remain lower during the winter owing to halted constriction activities, Abbasi said.

He said cement sector had performed slightly better in FY12 so far primarily because of the low base effect and also on the back of the of higher prevailing prices of the cement in the country as the price of 40kgs bag had reached Rs 423 from Rs 339 in same period last year.

Moreover, the prices of coal, which is the key cost driver for the cement producing companies, have also declined in international market.

Coal prices which were hovering around dollars 142 per ton in January 2011 have declined to dollars 110 per ton in January 2012.

"We had showed an optimism on further decline in coal prices after Queensland mines in Australia had resumed production in full swing after the devastating floods of 2011 however, as per the international sources there is fear of floods in Queensland again which could damage coal chain supply lines and cause disruptions to exports, which may impact on the price of cooking coal just as major companies are beginning to ramp up production after the previous floods", he said.