As such, cement sales rebounded in August after a 25 percentage point decline in the previous month as this year the Lebaran holiday fell in July (28 July to 1 August 2014), implying fewer working days (Lebaran, also known as Idul Fitri, marks the end of the Ramadan, the holy fasting month). During the week prior to Lebaran and four days after Lebaran, heavy trucks - such as those used for cement transport - are prohibited from driving on the main roads of Java (in an attempt to make room for the people's mudik tradition). Moreover, in July political uncertainties were still lingering in Indonesia due to uncertainty about the result of the 2014 presidential election. This resulted in delays of some projects.

Domestic cement demand increased most on the islands Java, Kalimantan and Sumatra, by 47 percent, 44 percent and 32.8 percent, respectively.

The ASI targets a five percent (year-on-year) growth of cement sales in 2014 to 61 million tons. Santoso expects that this target can be achieved if cement sales continue to grow in the last four months of the year. In the January-August 2014 period, cement sales in Indonesia have grown 2.45 percent to 37.5 million tons from the same period last year.

Indonesian Cement Sales 2008-2014:

 Year    Cement Sales
   YoY Growth
 2014        61 million¹         +5.1%
 2013        58 million         +5.6%
 2012        55 million        +14.6%
 2011        48 million        +20.0%
 2010        40 million         +4.2%
 2009       38.4 million         +1.1%
 2008        38 million             -

¹ forecast
Source: Indonesian Cement Association (ASI)

Semen Indonesia, the largest cement producer of Indonesia, officially opened its new USD $5.76 million cement packing plant in Belang-Belang (West Sulawesi) on 9 September 2014. This plant has a (packing) production capacity of 450,000 tons of cement per year and is expected to strengthen the company’s distribution network. It will smoothen infrastructure development in eastern Indonesia, particularly on the island of Sulawesi. Currently, Semen Indonesia controls about 44 percent of the country’s cement market.

Further Reading:

Update on Indonesian Cement Industry: Prospects for 2014 and Beyond