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Cement industry takes hit from slowdown in construction, govt spending
Indonesia’s cement industry faced declining sales in the first quarter of this year amid a slowdown in government infrastructure development.
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Slowed development: Under-construction buildings to be used by coordinating ministries are seen on Aug. 17, 2024, in Nusantara, East Kalimantan, as Indonesia marked its 79th Independence Day. (AFP/Bay Ismoyo)
Indonesia’s cement industry has recorded declining sales amid a slowdown in government infrastructure development.
The Indonesian Cement Association (ASI) reported a 7.4 percent year-on-year (yoy) decrease in cement sales in the first quarter of 2025, with sales falling to 13.4 million tonnes, down from 14.5 million tonnes in the same period last year.
The association noted sales volumes amounting to 3.8 million tonnes in the month of March, which marked a 21.6 percent yoy decline.
ASI chairman Lilik Unggul Raharjo attributed the contraction in sales to weaker household spending as well as slower infrastructure construction by the government and said the Idul Fitri festivities had also weighed on sales growth.
He projected continued pressure on the cement industry throughout the year, driven by global economic uncertainty and excess production capacity in the domestic market.
Cement sales have been on a downtrend in many regions across the archipelago, with the steepest decline seen in Kalimantan at 21.8 percent, followed by Bali and Nusa Tenggara at 15.2 percent and Sulawesi at 13.9 percent.
The decrease of cement sales in Kalimantan was due in part to the slower development of projects in Nusantara as the government had cut budget spending for the construction of Indonesia’s planned future capital city, Lilik noted.
