Indonesian price hike feared due to higher production costs

Indonesian price hike feared due to higher production costs
Published: 14 December 2007

Indonesian cement producers will raise their selling prices by 5-10 per cent next year on rising production costs following a surge in energy prices, the Indonesian Cement Association (ASI) said.

The price rise will likely put a brake on demand growth to 4 per cent next year from around six per cent this year, ASI chairman Urip Trimuryono said.

"A number of large projects will likely delay buying cement hoping for the price to fall again", Trimuryono said.

He said producers are forced to raise the prices to make up for an increase in production costs.

"In addition to energy price hikes, inefficient distribution systems will also cause an increase in cement prices in the region", he said.