PT Semen Gresik will raise its export volume in 2006 in order to anticipate tight product competition and continuing low domestic demand for cement, a spokesman said. PT SG President Director Dwi Sutjipto told local journalists the company’s export volume this year was planned to be about 2.45Mt or 15 per cent of total production which was targetted initially at about 16.2Mt.
In the previous year, SG’s export volume was about 13 per cent of total production reaching 15.8Mt.
"Apart from efficiency, the decision of raising the export volume will be taken in order to boost our sales. Competition among cement makers is getting tighter and tighter and a price war is still going on while domestic demand for demand is not like what we had expected," he said.
Sutjipto said domestic cement sales up to the end of May 2006 decreased by about three per cent compared to the same period in 2005. He said the situation had belied earlier expectations that domestic demand for cement would increase by 8-10 per cent in 2006. SG was also planning to to increase its output by about 10 percent in 2006 compared to the previous year. The same target has been imposed on sales and bussiness profit sectors.
At an SG General Shareholders’ Meeting in Jakarta at the end of June, it was reported that the company had recorded a business profit of as much as Rp1.023 trillion (US$1.023bn) in 2005 or up 100.9 per cent compared to the bussiness profit in 2004 of Rp508.9 billion (US$508.9m). The increase in the 2005 profit was among other things made possible by domestic cement sales reaching about 6.9 per cent or 14.27Mt compared to previous period of as much as 13.34Mt.