The Semen RI Industry Experiences Excess Capacity, Entrepreneurs Beware Of Unemployed Factories

Chairperson of Lilik Unggul Raharjo breast milk (Photo: Theresia Agatha/VOI)

JAKARTA - The Indonesian Cement Association (ASI) said that the cement industry in the country is experiencing oversupply. This is in line with the continued growth in production capacity of 119.9 million tons and production utilization of 55 percent.

"Our capacity is 119.9 million tons. The amount of absorption is only 55 percent. So, our capacity is really over capacity," said Lilik Lilik Chairperson Unggul Raharjo when met at the Shangri-La Hotel, Jakarta, Monday, June 3.

"So, many factories are forced to idle or not completely run in a year. How long will it take for the road," he continued.

Lilik is also worried that if there are additional new cement factories in Indonesia, they will later affect cement utilities in the market.

"That's why if we oversupply, there is another new cement factory, yes, the utility is getting better. If the utility is getting lower, the cost is higher, right," he said.

He did not deny that the consumption of cement for the Indonesian people was still very low per year. Thus, the absorption for cement is still far from the expected figure.

"Yes, this is because our per capita cement consumption is still low, which is 0.23 million per million population. So, if the population is around 270 (million), that's only 0.23," he said.

Furthermore, Lilik hopes that the Indonesian economy will continue to grow in the future. Thus, development continues and the absorption of cement in the country can increase.

"We hope that the economy will continue to grow, the GDP will grow. So, development is running, the economy is running, and consumption of cement will increase," he said.

As for 2024, breast milk targets the growth of cement utilization in the country to be around 3 percent. "We hope that in 2024 there will be 2-3 percent growth. Hopefully, this year (utilization) can reach 57 percent," he concluded.