Despite Indonesia's GDP growth having slowed to 5.62 percent in the third quarter of 2013 (yoy), increasing cement sales in October suggest that there has been a small surge in property and infrastructure projects as both components account for almost 100 percent of the country's cement demand. Although cement demand increased more in the islands outside Java, the latter continues to account for most cement demand. In October, Java - Indonesia's most populous island - bought 3.2 tons of cement, equivalent to 57 percent of the nation's total cement consumption.

In the January-October 2013 period, cement sales in Indonesia rose 5.8 percent to 47.2 million metric tons.

Domestic Cement Sales  
in million tons
             44.6              47.2   +5.8%

Source: Indonesian Cement Association

The outlook for Indonesia's total cement sales for the year 2013 had been revised down last month by the Indonesia Cement Association (ASI) from 61 million metric tons to 58 million metric tons amid the nation's current deteriorating macroeconomic context, which includes slowing GDP growth, higher interest rates, high inflation and a depreciating rupiah exchange rate.

Total Cement Production and Consumption of Indonesia:

     2010    2011    2012
Cement Production   
in million tons
   37.8    52.0    60.6
Cement Consumption
in million tons
   40.8    48.0    55.0

Source: Indonesia Cement Association