Displaying items by tag: Indonesia
Siam Cement targets Indonesia for major investment
05 March 2012Indonesia: Thailand's Siam Cement Group (SCG) has revealed plans to build a new cement plant in Indonesia to capitalise on the country's rapidly-growing demand for construction materials. Kan Trakulhoon, president and chief executive officer of SCG, said that the company would invest US$300m in a cement plant in Sukabumi, West Java. The plant will have a capacity of 5000t/day and construction is expected to start by the end of 2012.
The investment comes after SCG bought a 100% stake valued at US$135m in Boral Indonesia, a company that produces ready-mixed concrete, from Australia-based Boral in February 2012. Kan said that SCG's growth lies outside of Thailand and that Indonesia is a big part of that.
The SCG chief, who has previously lived and worked in the Indonesian capital Jakarta, said that he had been impressed with Indonesia's improvement during the past few years. "During the last four to five years, the growth was very good. SCG has a lot of confidence in Indonesia," he said. Kan said he that he was not afraid of competition with Indonesia's more established cement makers as SCG had already acquired supporting companies such as Kokoh Inti Arebama, an Indonesian construction-material distributor.
Semen Gresik, Indonesia's largest cement producer, and other cement makers plan to invest a total of US$6.27bn during the next three years to boost production. The investment is expected to produce an additional 30Mt/yr of cement in the country, with annual output reaching 90Mt/yr in 2017 from 52Mt in 2011. Chaovalit Ekabut, SCG's chief financial officer, added that demand for SCG's products remained high in Indonesia.
Looking ahead, Kan said that in the next five years, the company would invest US$5bn in its ASEAN-country operations. In 2012 it will spend US$1.3-1.5bn in various regional investments, but Kan did not disclose how much the company has set aside for Indonesia.
New captive power announced for Indocement project
24 February 2012Indonesia: Indonesia's second largest cement producer PT Indocement has announced plans to build a 2 x 30MW power plant in Pati, Central Java. The plant, which will cost around US$200m, will guarantee a power supply to Indocement's new cement factory, which is to be built in Pati later in 2012.
The new cement factory will cost around US$300m, according to Indocement's corporate secretary Sahat Panggabean. It will have a capacity of 2.5Mt/yr and will be operational by mid-2015. This will take Indocement's domestic cement capacity from 18.5Mt/yr up to 21Mt/yr.
Indonesia: PT Semen Gresik has announced plans to build a new 0.6Mt/yr, US$133m integrated cement plant at Manokwari in Papua. Company CEO Dwi Sutjipto said that Semen Gresik wanted to 'dominate' the cement market in Indonesia's eastern regions.
The plant will be commissioned in 2014 after the installation of a new packaging plant in the region, which is expected be commissioned by August 2012. The company has announced ambitious plans to develop a large number of new packing plants in strategic areas along the archipelago with the aim of improving product distribution and consequently cutting logistics costs. "Currently, Semen Gresik has 18 packing plants. We hope to have 16 to 17 more in the next five years to lower distribution costs," said Semen Gresik's finance director Ahyanizzaman, who added that each of the 0.2-0.3Mt/yr plants would require an investment of about US$10m.
Semen Gresik expects to complete the construction of at least four packing plants in 2012, with ongoing packing-plant projects at Sorong in Papua, Banyuwangi in East Java, Banjarmasin in Kalimantan and Balikpapan in Riau. "The packing plant in Banyuwangi is almost finished and the Papua plant is about 50% complete. Meanwhile, we are ready to construct the plants in Kalimantan. We expect to build in more areas in Kalimantan but we remain constrained by land acquisition," added Ahyanizzaman.
New packing plants are part of Semen Gresik's effort to improve its distribution, especially in areas in eastern Indonesia, which frequently face delivery hurdles leading to higher cement prices. Each packing plant will bag cement sent from its closest Semen Gresik factory.The Sorong plant, for example, will process cement produced by Semen Gresik's factories in Sulawesi. The packing plant will have a capacity of bagging 0.6Mt/yr. The company is investing around US$22.2m= in the Papua packing plant, which will be supported by a 10,000t silo and a 150m harbour.
The finance director also said that he expected Semen Gresik to increase its revenue by 10-12% in 2012 due to the new plants and ongoing work on integrated facilities at Tuban and Tonasa. The company forecasts a more moderate increase in its net profit due to its capital expenditure. "We estimate a growth of 1-2% in net profit in 2012 compared to 2011," said Ahyanizzaman. "The slight increase is due to the new factories producing below their full capacity."
New Java plant for Indocement
31 January 2012Indonesia: PT Indocement Tunggal Prakasa has reported that it will build a US$500m cement factory with a production capacity of 3Mt/yr in the regency of Pati, Central Java.
Sahat Pangabean, Indocement's corporate secretary, said that the company was hoping that the process of licensing the plant would be completed within 2012 and that construction would start immediately afterwards. Sahat added that the company was currently in the process of conducting an analysis of the plant's potential environmental impact.
The project will be run by Indocement's subsidiary PT Sahabat Mulia Sakti and is expected to be operational in 2015.
Indonesia domestic cement sales grow by 17% in 2011
11 January 2012Indonesia: Indonesia's domestic cement sales grew by 17% in 2011 on the back of new property construction, according to Indonesia's cement association (ASI). Total domestic cement sales in 2011 reached 48Mt, with more than half the sales in the main Java island, data from the association showed.
"Indonesia had large physical development during 2011 and the result followed strong economic growth figures. We also saw a huge decline in exports, which means domestic suppliers prioritised the domestic market," said ASI chairman Urip Trimuryono.
Total cement exports fell by 59% to 1.2Mt from 2.9Mt in 2010. The country's cement sales fluctuate month-to-month depending on factors such as holidays and the government's end-of-year project completion deadlines. Sales volumes in December 2011 rose by 17% from the same month in 2010 to 4.6Mt. The association has forecast cement sales growth by 6% in 2012.
"We believe the 2012 outlook for cement remains promising, supported by the land-clearing law and continued strong property demand on the back of a continued low interest rate environment," said Teguh Hartanto, an analyst at Jakarta-based Bahana Securities.
Indonesia's parliament stamped a long-awaited land acquisition bill in December 2011, an attempt to break the bottleneck in infrastructure development that has long been seen as holding back growth in the country.
Cement markets remain strong in Indonesia
19 December 2011Indonesia: Domestic cement sales in Indonesia, the largest economy in south east Asia, rose by 26% in November 2011 from the same month in 2010, according to data released by the Indonesian cement association (ASI).
Sales volume reached 4.4Mt, compared to 3.5Mt in November 2010. Despite this, sales were down by 4.7% compared to October 2011, which saw 4.7Mt of cement sold. It should be noted that end of year deadlines for completion of government construction projects traditionally inflate November figures compared to those for December.
The ASI estimates that total domestic sales will reach around 45-46Mt in 2011, up by 15% from 2010, according to its chairman Urip Trimuryono.
In the longer term it is likely that cement demand growth will be more rapid in the country, with Indonesia's parliament stamping a long-awaited land acquisition bill on 16 December 2011. The bill will attempt to remove a bottleneck in infrastructure development that has long been seen as holding back growth in the country, providing a greater demand for cement.
Anhui Conch embraces 'go-global' policy
16 November 2011China: Anhui Conch Cement Co Ltd, China's biggest cement producer, plans to add 10Mt/yr of cement production capacity to its annual total by 2015 via overseas expansions. This will include both setting up its own new facilities and acquiring international rivals that are currently weakened by the European debt crisis, according to Wang Jianchao, manager of Anhui Conch's foreign economic cooperation department. Anhui Conch wants to expand its production to other countries because China has restrictions on new cement projects, which aim to combat the industry's overcapacity. The Shanghai-listed company produced 110Mt of cement in China in 2010 according to its annual report.
Jianchao said that the company, which currently has no overseas production, is engaged in a 'go-global' strategy. "Many cement plant owners in the Eurozone want a quick bailout because they need cash to save their businesses, which were hit hard by the European debt crisis," said Wang, adding that the company is moving at the best time to build its overseas operation. He declined to disclose the budget for strategy, but said the company is financially strong enough to expand.
Anhui Conch Cement began its overseas expansion in late June 2011 when it signed a memorandum of understanding to invest USD2.35bn in several Indonesian cement plants. Wang offered no details on the status of the proposed Indonesian projects, but he hinted that the Anhui Conch's first foreign factory may open elsewhere because opportunities in other countries are also being explored.
"Apart from Indonesia, we are in discussions with potential business partners in Mongolia, Central Asia and South America. It's hard to say whether our foreign production will operate in Indonesia first, because other foreign projects may proceed more smoothly," said Wang.
To help its overseas expansion plan go smoothly, Anhui Conch teamed up with the Swedish industrial leader Atlas Copco Group AB to gain access to its cutting-edge mining machinery and training systems. The two companies have a history of cooperation dating to 1993 and the drilling equipment used by Anhui Conch is supplied by Atlas Copco.The Swedish company has a strong customer base in Indonesia.
Semen Gresik reports increased profits
24 October 2011Indonesia: Indonesia's largest cement producer PT Semen Gresik has reported income of USD1.28bn in the first nine months of 2011. This represents an increase of 12% over the same period of 2010. The net profit of the state company rose by 10% to USD305m, according to its president Dwi Soetjipto.
The rise in income and profit followed was attributed to a 10% increase in sales to 14.5Mt in the nine month period. This represents 74.3% of the company's sales target for the whole of 2011.
According to Dwi, the increase in net profit would have been even higher if it had not been for increased production costs. Dwi reported that the company had experienced a particular rise in fuel and electricity costs.
HeidelbergCement to invest USD500m in Indonesia
19 October 2011Indonesia: HeidelbergCement plans to invest USD500m in a plant on Indonesia's Java island, Indonesia's trade minister Gita Wirjawan announced on 19 October 2011.
Indonesia's cement sales, an indicator of economic growth in Southeast Asia's largest economy, rose 52% in September 2011 year-on-year due to increasing property and infrastructure building.
Cement sales volumes reached 3.8Mt, from 2.5Mt in September 2010 according to Urip Trimuryono, chairman of the Indonesian Cement Association. Sales in August 2011 had dipped 0.3% year-on-year, due to slower activity during the Ramadan and Eid al-Fitr holiday. Trimuryono forecast full year 2011 cement sales would grow 14%, with growth moderating next year to 10%.
Bosowa to develop cement capacity
12 October 2011Indonesia: The Makassar-based Bosowa Corporation, which has interests in property development, cement, financial services, power and rice production, has announced plans to spend USD120m to expand its cement production and distribution capacity. The company is hoping to cash in on a planned infrastructure spending spree by the government and a rapidly developing property market.
Erwin Aksa, president director of Bosowa, said that the combined production of its two cement units, Semen Bosowa Maros and Semen Bosowa Batam, was expected to reach 3.5Mt/yr in 2011. Between January and September 2011 the company sold 3Mt of cement, 86% of its production target for the whole of 2011.
"We are bullish that our target is achievable as demand for cement remains stable, supported by the growth in the property and infrastructure sectors," said Erwin.
Bosowa will spend USD70m to build another cement plant in Maros, South Sulawesi. After completion of the factory in 2012 Erwin said that the group's cement production capacity would rise to 4.5Mt/yr.