And it really is. Cement sales—despite all the negative reporting about economic fatigue, manufacturing recession, demand compression and construction slowdown—are actually picking up. In the four month period between July and Oct-19, cumulative dispatches grew 4 percent while dispatches in the domestic north zone grew by 11 percent. That, given expectations is phenomenal.

Of course, part of the reason for the overall increase is the demand coming from abroad for clinker. Cement companies in the south zones have been selling off clinker to overseas markets to keep plants running. Cumulatively, exports in the south grew by 32 percent in 4MFY20 (November numbers will be released over the next few days) while clinker exports grew by 93 percent year on year. Considering it is only last year that the industry started exporting clinker, the growth is substantial.

The more recent trend is being seen in the north zone where demand had slowed down considerably in the past year. In fact, during FY19, domestic demand in the south was much stronger than in the north. Companies in the latter were struggling because of domestic demand compression as well as exporting markets such as Afghanistan and India closing their doors, the latter market completely shutting down trade.

Cement manufacturers claim it is just organic demand that is being generated due to new household and commercial developments in the north. The likelier scenario is that cement dealers are stockpiling. Many of these traders and agents are informal. With the recent drive of the government to formalize and document the undocumented sector—and the soon-to-be-launched CNIC requirement for any purchase of more than Rs50,000—it is very possible that agents have been stocking up on tradable commodities before the new regulation kicks in.

On the other hand, the much hyped Naya Pakistan Housing Program (NPHP) has not yet launched any projects that can bring fresh demand for construction materials. Mass scale public projects have tremendous appeal for manufacturers in construction. This is definitely one project to look forward to, though cement manufacturers would keep their eyes peeled at the existing CPEC infrastructure projects that are currently underway and for which PSDP funds have been released. Changing weather conditions in the north will slowdown demand in the region once again over the next few months. Changes in regulatory environment may also further curb trading. Any renewed business confidence to boost private sector investment in commercial and housing projects could not come sooner.