Indonesia’s cement market is facing overcapacity for some years now. The integrated cement production capacity of the country is approximately 109.9 million tons per year, while consumption in 2018 was around 69.6 million tons.
However, the industry is now recovering from a slump and is expected to perform better in 2019. Indonesia’s domestic cement sales growth is expected to be around 3-4 percent – mainly boosted by infrastructure and national strategic projects, rural development, and a million house programs from the government.
In addition, the government also targets cement exports to reach 7 million tons - up 24 percent compared to 2018, according to industry ministry’ official statement.
Meanwhile the gross margins of PT Semen Indonesia and PT Indocement Tunggal Prakarsa, the country’s two main cement producers, improved from 29% to 32% and 26% to 31%, respectively in H1 2019.
The ministry is also focusing on the use of local clinker raw materials in the grinding plants – which is expected to reduce imports of similar products.
In the past, Indonesia’s had a huge appetite for cement, which led to a series of new cement plants and investments. However, the cement demand dwindled or were not according to the predictions, leading to overcapacity in the country.
Mr. Rahman Kurniawan, Senior VP of Supply Chain,
PT Semen Indonesia shares more on
‘Opportunities in Indonesia's Cement Industry’ at
CMT’s 21st Asia Cement Trade Summit on 13-14 November, 2019 in Manila.
Contact Grace at
grace@cmtsp.com.sg or call +65 6346 9147 for more details.
Read more:
Indonesia Targets Cement Exports 7 Million Tons in 2019
