PT Indocement - January 2017

Total cement sales in Indonesia, including PT Indocement, fell by 5.4 per cent MoM to 5.7Mt in November 2016. This represents an annual decline of 5.3 per cent. Sales for the first 11 months of the year, however, were up 2.8 per cent compared to the same period in 2015, driven by government-led infrastructure development. The housing market, meanwhile, remained flat and high rainfall has delayed a number of projects.

Cement consumption by region showed an 18.2 per cent decline in sales in West Java, falling from 985,667t in November 2015 to 805,960t in the same month in 2016. Jakarta also saw sales fall, this time by 11.7 per cent to 443,984t. In fact, all regions reported declining sales in November. Consumption figures for the January-November 2016 period, however, revealed increases in Sulawesi (+14.7 per cent), Maluku and Irian (+7.1 per cent), Central Java (+6.3 per cent), Sumatra (+4.8 per cent), East Java (+3.4 per cent), Nusa Tenggara (+1.8 per cent) and Yogyakarta (+0.2 per cent). Cement and clinker exports figures were also more encouraging with total Indonesian exports for January-November 2016 advancing by 52.2 per cent to 1.5Mt, compared to 974,783t in the same period a year earlier. 

Rising domestic production capacity, however, has had a negative impact on utilisation rates, which came in at 65 per cent in 2016, significantly down on the 76.9 per cent recorded in 2015. 2017 is expected to see this rate fall even further before a predicted recovery in 2018 driven by a rebounding housing sector.