Holcim’s new Tuban cement plant begins production

PT Holcim Indonesia Tbk officially announced its first cement production from the Tuban 1 line at its Tuban Plant on 17 June. The inauguration of the 1.7 million tpa line was attended by the Board of Directors and a number of key customers and distributors, and marked with a ceremony and plant tour to witness the details of Holcim’s biggest investment worldwide at this time

Speaking at the ceremony, Holcim Indonesia CEO, Eamon Ginley, said: “The demand for Holcim products increased and has continued in 2014. This new capacity positions Holcim Indonesia in a very favourable position to capture future growth. Holcim Indonesia is committed to serve its customers with excellence by being easy to do business with, create values and provide the best solutions, as well as build lasting relationship with the customers”.

The capacity boost from the new line, which will be supplemented by the addition of the Tuban 2 plant in 2015, will help the company meet local demand, having operated at maximum capacity for the last couple of years. The investment completes the company’s footprint for Java, which has included timely investments in logistics and channel capacity for domestic markets as a whole.

“Tuban Plant enables Holcim…to achieve our aspiration of maintaining our position within the top three in the Indonesia’s cement industry. Particularly in East Java, we expect to double our market share from today 9% to 16%,” said Eamon. He added: “Tuban Plant is also built from the acceptance and support of the locals. We aim to contribute to the communities in which we operate through investment and engagement, and are committed to building relationships based on mutual respect and trust with all our stakeholders to show that we care. We believe that by fulfilling our social responsibilities we can add value to our business, further contributing to our vision of building sustainable solutions for society’s future”.

Indonesian investments

Holcim has increased shipment by rail specifically in Java to shorten supply chain with more time and cost efficient operations, and has further extended its brand and reach into Kalimantan and Sumatra. In support of a full order book, a new aggregates quarry was acquired and an additional investment programme is underway to expand the number and capacity of concrete plants in order to keep up with demand.

During the first quarter of the year, Holcim gained from steady sales, despite slower construction activity compared to a year ago. Margins have held up as the company passed on transportation cost increases that have affected the sector as a whole. The company achieved sales revenue growth of 9.1% on an increment of 1.5% in cement volumes, increment of 7.9% in ready-mixed concrete volumes and increment of 27.5% in aggregates volumes.

Environmental and Social Performance

Early this year, Holcim Indonesia received double Platinum Awards from the Global CSR Summit 2014 for its Posdaya program supported by its Cilacap Plant and Integrated Farming Program in Tuban. Recently, Holcim received a Small & Medium Enterprises Award from Sebelas Maret University of Solo as the Best Private Company supporting local small businesses and creating new business opportunities for the community surrounding the Tuban Plant through a seafood processing programme, young entrepreneurship development programme and duck egg hatchery programme.

Outlook

Going forward, Holcim is expecting demand to remain good, with the elections providing an opportunity for resurgence in business sentiment and investment to secure Indonesia’s long-term growth.

Adapted from press release by Katherine Guenioui

Read the article online at: https://www.worldcement.com/asia-pacific-rim/18062014/holcim_indonesia_inaugurates_tuban_1_plant_371/