Skip to content

Bestway Cement: building for a greener future

This week Bestway Cement announced that it is building a new 7200tpd cement plant in Paikhel, Mianwali district, Punjab province, Pakistan, which it expects to commission by the end of this year. The Pakistani cement company has slipped into second place behind Lucky Cement in terms of domestic cement capacity. However, it is not standing still and is preparing to fend off competition for its market share.

As detailed in its 3Q22 report, Bestway Cement plans further expansion, helping it to surpass 14.5Mta of clinker capacity. The cement producer is also investing US$140m in a brownfield expansion project that will add a new 7200tpd clinker line at the Hattar plant. This new line, to be built by Sinoma International Engineering, is expected to be commissioned by 30 June 2023. A 9MW waste heat recovery plant is also being installed at the site.

Meanwhile, Lucky Cement’s expansion projects will soon take it to 15Mta of cement capacity, and Pakistan’s third-largest cement manufacturer, Fauji Cement, will reach 10.3Mta, when it completes its acquisition of Askari Cement.

A need to halt declining cement sales
Bestway Cement’s financial performance has started to decline in recent months and it will need to reassert its presence in the domestic market. The company reported 5.2Mt of clinker production and 5.95Mt of cement production during the 9MFY22. Clinker production fell by 14 percent and cement production by 10 percent compared to the nine months ended March 2021. Meanwhile, local cement dispatches fell by six percent in the 9MFY22 as compared to the 9MFY21.

Last year, Bestway Cement states that there was a surge in construction activity in the north following brief lockdowns due to COVID-19. The company claims that the demand for cement during the current year has suffered due to high inflation and increasing commodity prices. International disruptions have also seen a surge in coal and oil prices, while the Pakistani rupee has depreciated sharply.

Exports under severe pressure
Meanwhile, Bestway Cement has been unable to rely on exports to fall back on, as these have decreased by 72 percent in the 9MFY22, due to “significant political and economic uncertainty prevailing in Afghanistan,” reports Bestway Cement.

Energy management
Bestway Cement has been the sector’s leader in terms of its energy management and efficiency programme. The company has increasingly moved away from reliance on the national grid, which has persistent power outages. Bestway Cement has installed WHR facilities at its four plants in Chakwal, Hattar, Farooqia, and Kallar Khar.

There has also been a shift toward solar power generation. The most recent additions were at the Chakwal and Kallar Kahar cement plants, which commissioned 15.2MW and 14.8MW of solar photovoltaic capacities in October 2021. These additions followed the 14.4MW Reon Energy captive solar power plant at the Farooqia cement plant in June 2021, while Hattar cement factory has 6.4MW of solar capacity. This totals a group capacity of 50.8MW of solar power costing US$25m. It will reduce the company’s carbon footprint by 1.7Mt of CO2 over the lifetime of the project.

While Bestway Cement is still the largest cement producer in northern Pakistan, it hopes that continued capacity expansion will ensure it can maintain its market share. Its focus has been on reducing its reliance on fossil fuels and decarbonization. This will reduce the company’s exposure to rising energy costs, making it more competitive both domestically and in the export market. Furthermore, the company will build on its sustainability credentials to reinforce its brand locally. Such a branding opportunity may well have presented itself with the Pakistan Standard & Quality Control Authority’s (PSQCA) recent request for Bestway Cement, Hattar Cement Ltd, and Mustenhkam to stop using kraft paper sacks and to change to polypropylene block bottom valve sacks to reduce health risks.

Leave a Reply