Growth in cement sales were highest on Sulawesi, Bali & Nusa Tenggara and Sumatra as demand rose due to the start of power plant and smelter construction in these regions.

Year to date, Indonesian cement sales stand at 55.6 million tons in the January-November 2015 period, up 1.9 percent from the same period last year. Santoso expects cement sales to remain strong in the last month of the year, hence full-year cement sales may reach 61.5 million tons, up 2.5 percent (y/y) from 60 million tons in 2014.

Optimism about the cement industry also stems from the start of two new cement factories: Semen Jawa (with an annual cement production capacity of 1.7 million tons) and Semen Merah Putih (annual production capacity of 3.6 million tons). Furthermore, Semen Bosowa and Semen Bima are also expected to expand production capacity before the year-end. In the first quarter of 2015, many domestic cement producers curtailed output as demand had weakened. In the first half of the year cement demand mostly originated from the property sector, not from major infrastructure projects.

Indonesian brokerage Danareksa Sekuritas expects cement sales to grow further in 2016 due to the government's push for infrastructure development. However, the country's property market is expected to remain sluggish and therefore growth of cement sales will most likely not see double-digit growth.

Indonesian Cement Sales 2008-2015:

 Year    Cement Sales
   YoY Growth
 2015¹        62 million         +2.5%
 2014        60 million         +3.3%
 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 ASI forecast
Source: Indonesian Cement Association (ASI)