Indonesian cement consumption growth was lower than forecast in 2014. Consumption improved by 3.3% y/y to 59.9 million t. This is down on the Indonesian Cement Association’s forecast of 3.5% – 4%, a figure that had already been downwardly revised from 6%. The lower growth rate has been attributed to a slowdown in infrastructure projects amid political uncertainty surrounding Indonesia’s presidential elections, as well as a decline in commodity prices.
However, according to the association’s Chairman, Widodo Santoso, cement consumption in Indonesia is still higher than other countries in the Association of Southeast Asian Nations. He also noted that domestic cement consumption is likely to rise as infrastructure investment picks up again.
In December 2014 alone, domestic cement sales came in at 5.4 million t, up 1.7% y/y but down 7.2% m/m.
In other news from the region, Turkey’s Sabanci Holding has increased its presence in Southeast Asia with the inauguration of a tyre cord and polyester yarn plant in Citeureup, Indonesia. The manufacturing facility is operated by a Sabanci subsidiary – Kordsa Global’s Indonesian arm Indo Kordsa Tbk. According to local press, the new plant represents an investment of US$100 million. This is the company’s second plant in the country.
Earlier reports have suggested that Sabanci Holding may be interested in further expanding its presence in Europe via the acquisition of some of Lafarge-Holcim’s divested assets. Binding bids for the assets are due this week.
Edited from various sources by Louise Fordham
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