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Following the realisation of these foreign and indigenous investments, Indonesia’s national cement manufacturing capacity increased significantly.
Problematically, however, the property market’s sharp cooling coincided with a sharp decline in domestic cement demand growth. Domestic cement sales did indeed continue to increase, but the rate of growth decreased from double digits to very low single digits.
As a result, there was a quickly expanding surplus of cement supply (also known as a glut), which greatly pressured cement prices.
Additionally, because Indonesian cement exports are still extremely small, despite growth, the country’s capacity utilisation rate has significantly decreased.
This is because Indonesian cement facilities cannot run at full capacity. Exporting cement may be a way to counteract the effects of domestic cement demand’s very slow growth. However, Indonesian cement producers find it challenging to compete on the international stage with their more powerful rivals.
The Indonesia Cement market accounted for $XX Billion in 2021 and is anticipated to reach $XX Billion by 2030, registering a CAGR of XX% from 2022 to 2030.
The market is currently oversupplied, and Holcim Indonesia is experiencing a slowdown. However, given the cyclical nature of the building industries in developing nations, it will only last a short while.
Overall, Indonesia’s macroeconomic fundamentals are still sound over the long run, and the domestic economy will rebound when delayed infrastructure and housing projects are completed.
The new Tuban Plant completes its footprint in Java as it will better service markets, ensure supply, and secure their position among the three largest players in Indonesia’s cement industry
