In the midst of declining purchasing power
due to the global crisis, government projects become a mainstay and supporter
of the performance of the national cement industry. Indonesian Cement
Association (ASI) reported that there was a slight increase in cement
consumption nationwide. Widodo Santoso, Chairman of ASI, in Jakarta, on Monday
(September 14), said that the sugar in consumption indicates the beginning of
the movement of development of infrastructure, housing, apartments, as well as
disbursement of development budget of local government.
Widodo
pointed out that the rise of consumption in August occurred because there were
no holidays compared to the previous month. In addition, the disbursement of
government funds is evident in cement demand in South Sulawesi, Lampung, Jambi,
Banten, West-java, South-West Sulawesi, Bali and West Nusa Tenggara which on
average increased above 20%.
ASI
expects that consumption in September and December continue to increase to
improve annual performance. According to him, if infrastructure projects and
development budget in the regions are running quickly and according to
government’s target, annual cement consumption may rise 4% to 6%, so that
consumption through 2015 could be higher than last year.
The
consistency of increase of cement consumption, he added, is required along whit
the operation of a number of cement plants that have been operating in August
with a capacity of 1.7 million tons, will then be followed by Bima semen with a
capacity of 1.5 million tons, Semen Merah Putih with a capacity of 3.6 million
tons, and Siam semen with a capacity of 1.7 million tons per year. Therefore,
he continued, the domestic cement manufacturers expect infrastructure
construction to run properly due to the decrease in development realization
that would harm employers. While on the hand, export markets have not shown an
increase in demand.
ASI
expects that the national cement industry is likely to grow 12% this year in
line with increasing domestic consumption, which is predicted to reach 54
million tons. Acceleration of the development of infrastructure and property,
as well as increased government spending is believed to be the motor of growth
of the domestic cement industry.
With
the star of production of some new cement factories this years, Widodo is
optimistic that there will be no shortage of supply of cement in the country.
Local cement manufacturers will not export cement before domestic demand is
safe. The reason, he added, is that profit in the domestic market is better
than in the export in the market due to high transportation costs. ̋It does not
mean that cement prices abroad is cheap, just the same, but when coupled with
cost of transportations, the costs become higher,” he explained.
Quoting
data of ASI, in August cement consumption in Sumatera reached 1.15 million
tons, increased 21.4% from the same month last year. Cement consumption in Java
reached 3.04 million tons, an increase of 14.9%. In addition, the consumption
of cement in Sulawesi last month reached 400.000 tons, up 8.1%, in Bali and Nusa
Tenggara 310.000 tons, up 14.5%, in Maluku and Papua 99,000 tons, up 11.2%.
The
lowest consumption is in Kalimantan which only reached 370,000 tons. an
increase of 2.6%. This, the overall consumption in August 2015 year reached
5.34% million tons or 14.7% higher than last year. From January to August 2015,
cement consumption reached 37.26% million tons or – 0.3% compared to the same
period last year. (E)
Business New - September 16, 2015
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