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PT Indocement Tunggal Prakarsa, a publicly listed cement
maker, is optimistic that the company will be able to fulfill domestic
demand, that is forecasted to increase about 5 percent, next year.
Indocement executive director, Christian Kartawijaya, said Thursday
that in order to do that, the company would increase its production
volume by 13.65 million tons in 2007, from this year's 13 million tons.
"Some factors that will enhance the demand include the stable
macro-economic condition, the decrease of the BI rate, as well as the
reduction of the mortgage interest rate," he told The Jakarta Post at a
ceremony of the signing of an agreement between the company and its
labor union.
BI Rate at present stands at 9.75 percent and is expected to go down
further next year -- a move that will as well force banks to gradually
cut its mortgage rates which should eventually push up demand for
housing loans.
In addition to supplying the domestic market, the company also exports
its products to several Asian and African countries, with Bangladesh
and Brunei becoming its main markets.
"As a local player in cement manufacturing, we always give our priority
to the domestic market rather than exporting our products," he said.
"After we have met the local demand, we then export the rest of the
products."
Currently the company exports about 25 percent of its total output. In
term of sales, Indocement controls about 30 percent of domestic market
share.
Indocement currently has three production plants: the Citeureup plant
and the Palimanan plant in West Java, and the Tarjun plant in
Kalimantan, with a total production capacity of 16.5 million tons per
year.
He added that the company plans to modify its Citeureup plant to be
able to increase its production capacity by 600,000 tons, with the
production cost of US$25 per ton.
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