Indonesia’s November cement consumption fell by 2.4 per cent to 3.27Mt from a year ago due to weaker demand in Java, the most heavily populated island and main cement market, industry data showed.
However, total cement consumption for the year to date has risen 12.6 per cent to 34.96Mt, thanks to a boom in infrastructure and other construction.
PT Semen Gresik Tbk, Indonesia’s biggest cement producer, said its domestic sales climbed 1.2 per cent to 1.48Mt in November compared from a year ago.
Gresik and its main rival PT Indocement Tunggal Prakarsa had both predicted last month that cement demand would decline in 2009 because of tougher economic conditions.
Indonesia’s benchmark interest rates fell to eight per cent by the end of 2007, from 12.75 per cent in 2005, prompting investment in new property projects.
But as higher fuel and food prices pushed up the consumer price index this year, the central bank steadily hiked interest rates, to a high of 9.50 per cent in October.