Builders concerned about cement shortage

JAKARTA (JP): Builders, crying out over the substantial increase in cement prices, yesterday urged the government to take measures to end shortage of supplies of the construction material.

"Cement prices in the Greater Jakarta area have increased to about Rp 8,000 (about US$3.7) per 40-kilogram sack, far above the government-set local price reference of Rp 6,750," Chairman of the Association of Indonesian Builders (Gapensi) Agus Kartasasmita told reporters after meeting with Vice President Try Sutrisno here.

Agus said the government should be more committed to overcoming the supply problem.

Minister of Industry Tunky Ariwibowo said Thursday that the country's cement production can actually meet demand but distributors are taking advantage of market fears of a possible shortage by raising prices.

Agus said yesterday that the recent price increase is likely caused by speculation by distributors. "The government should find out whether the supply shortage is caused by speculators or a miscalculation of supply and demand," he said.

He said Gapensi executives had discussed this issue with Try, who wondered why such a cement supply shortage occurs annually.

Indonesia's cement production, which rose from 17.38 million tons in 1992 to 19 million tons last year, is expected to further increase to 21.3 million tons this year, while its total annual production capacity will increase from 20.1 million tons at present to 22.4 million tons later this year.

Cement prices have increased particularly in Java, where monthly demand increased substantially to 1.29 million tons in June from 999,833 tons in the same month a year ago. Utilization in Java accounts for almost 70 percent of the country's total cement consumption.

Agus also said yesterday that Gapensi will hold a national workshop in Batam on Aug. 22 to Aug. 24. The workshop, which will be opened by the Vice President, will be attended by some 700 executives.

The association has 33,000 members.(icn)