Competition in national cement industry is getting increasingly harder and harder. After declining in early 2011, the market share of Semen Gresik Group is now beginning to crawl up. Deputy Minister of State Enterprises for Strategic Industrial and Manufacturing Sector Irnanda Laksanawan says the expansion of private cement companies has made the competition in national cement market share become harder and harder.
"In Java, Semen Gresik Group has been defeated (in the control of market share). But nationally it still wins," he said last week.
According to Irnanda, with a production capacity of 20.2 million tons per year, Semen Gresik Group (Semen Gresik, Semen Padang and Semen Tonasa), until the end of first semester of 2011 recorded its control of 43.2 percent share of the domestic cement market. "It's become the market leader," he said. 43.2 percent is slightly higher than the initial position of 2011 in which the share of Semen Gresik Group declined to 40.8 percent. This was due to the maintenance of several production facilities of Semen Gresik.
In the domestic market, three big players dominate. Semen Gresik Group's position as market leader is tightly followed by PT Indocement Tunggal Tbk (INTP). The ‘Tiga Roda’ brand cement manufacturer which has a production capacity of 18.6 million tons records to have controlled 30.9 percent share of the domestic cement market. The next one is PT Holcim Indonesia Tbk (SMCB), in third position with 13.6 percent share. Currently, the company that was originally called Semen Cibinong has a production capacity of 8.5 million tons per year.
Irnanda admitted, the Java market is particularly still controlled by Indocement with the market share dominance of 40.1 percent. Semen Gresik Group sticks tightly in the second position with 38.2 percent market share dominance and 19.3 percent market share is controlled by Holcim in the third position. "As a state-owned company, PT Semen Gresik must spread its cement products throughout Indonesia so that regional development can run smoothly," he said.
President Director of PT Semen Gresik Tbk (SMGR) Dwi Soetjipto said, of the total production capacity of 20.2 million tons, the products of SMGR are relatively well spreading throughout the country. In more specific details, it can be described as follows; Java (Semen Gresik) distributes 10.0 million tons, Sumatra (Semen Padang) 6.1 million tons, and Sulawesi (Semen Tonasa) 4.1 million tonnes. "Meanwhile, for Indocement, of the total production capacity of 18 million tons, some 15 million tons is just distributed in Java," he said.
To meet the demand for national cement each year which is estimated to rise from 5.5 to 7.9 percent, Semen Gresik Group continues to expand. The target is that the new cement plant in Tuban can start its commercial operation not later than early 2012 and the other in Tonasa will be operated commercially in April 2012. In addition, the company continues to finalize its new cement plant construction in Central Java and Padang.