Cement demand forecast to recover, Indonesia

Cement demand forecast to recover, Indonesia
Published: 03 July 2006

Indonesian cement demand is estimated to recover in the second quarter this year after in the first quarter of 2006 saw consumption dipping by five per cent compared to the same period last year.

Marketing Director of publicly listed PT Semen Gresik Chabib Bahari disclosed that the decrease in cement demand in the past few months was only temporary and demand would recover in the second quater this year.

"In the second semester, the demands for cement will increase again. I believe we can even have a growing demand for cement by one per cent, although not by seven per cent like last year," said Chabib last week.

He added that demand for cement would keep increasing until next year since some private and public government projects had started. "The decrease in demands for cement by 3-4% is only temporary," he noted.

President Commissioner of PT Semen Gresik Agus Tjahajana Wirakusumah was optimistic that demands for cement would recover in the second semester of 2006.

"In some markets, like Bali, the demands for cement have recovered. The utility rate of Semen Gresik currently has even reached 100%," revealed Agus.

Data by the Indonesian Cement Association (ASI) showed that the national total sales volume of cement in May 2006 rose by 11.5% to 3.2Mt from 2.87Mt in April. However, compared to the sales volume in May last year, the sales volume has decreased by -2,4%.

The export volume of cement in May 2006 increased by 1.57% to 616,000t from 507,000t in April, while the domestic sales volume climbed by 9.75% from 2.36Mt to 2.59Mt.

Cement sales in the first five months reached 4.5Mt, down slightly from 14.55Mt in the same period last year.