First-half domestic cement sales up 9%

First-half domestic cement sales up 9%

Soraya Permatasari, Bloomberg/Jakarta

Indonesia's domestic cement sales rose 9 percent in the first half from a year earlier, led by growth in West Java and Banten provinces, PT Semen Gresik, the nation's biggest cement maker, said.

Domestic sales by all Indonesian cement makers, including PT Indocement Tunggal Prakarsa, the nation's second-biggest cement maker, rose to 15.1 million tons, Semen Gresik said in a statement on its Website, citing the Indonesian Cement Association data. Exports fell 11.6 percent in the period to 3.18 million tons, it said.

Cement sales in Banten province surged 25 percent to 971,474 tons in the six-month period, while sales in West Java province rose 19 percent to 2.63 million tons, today's statement said.

Cement sales in Indonesia are rising as economic growth and the lowest interest rates in six years raise consumer spending and boost construction of homes and shops. The US$258 billion economy, Southeast Asia's biggest, grew 5.1 percent last year and is forecast by the government to expand 6 percent in 2005, the fastest since 1996.

Gresik's domestic cement sales rose 7.3 percent in the first six months to 6.68 million tons from a year earlier, while exports fell 17 percent to 878,530 tons, the company said.

Local cement demand will probably rise as the government embarks on projects to build roads, power plants and other infrastructure next year to create more jobs and accelerate the pace of economic growth to an average 6.6 percent a year, the company said earlier. Indonesia needs $150 billion for investing in infrastructure in five years, the government said in January.

Gresik said in May it plans to build a $400 million plant to increase capacity by 16 percent. The company's plants in East Java, Padang in West Sumatra and Tonasa in Sulawesi have a combined capacity of 15.8 million tons a year.