SMGR to have more packing plants

The country’s largest cement producer, PT Semen Indonesia, will this year see the launch of more packing plants in an attempt to cope with soaring demand in eastern Indonesia.

“We hope to see the operation of three more packing plants in Banjarmasin, Balikpapan and another in the province of West Kalimantan this year. We will continue to develop facilities in the eastern part of the country,” corporate secretary Agung Wiharto said in Jakarta on Friday.

JAKARTA. Semen Indonesia, whose shares are traded under the code SMGR on the Indonesia Stock Exchange opened its 20th packing plant in Sorong, Papua on Friday.

The packing plant has a capacity of 2,200 bags or 120 tons of cement per hour. It is also equipped with a seaport with a capacity of 10,000 deadweight tons.

The company disbursed Rp 162 billion (US$16.8 million) for the construction of the Sorong packing plant.

Agung said that the company’s three additional packing plants would cost between Rp 100 billion and Rp 150 billion each.

Semen Indonesia’s president director, Dwi Soetjipto, said the company expected to have 28 packing plants by 2015, from its current total of 20.

“The company will continue to build more packing plants in order to reduce logistics costs so that our cement is more affordable. This is also part [of a strategy] to strengthen the company’s position in the national cement market, which is becoming more competitive,” Dwi said.

Besides the three new packing plants to be completed this year, Semen Indonesia, formerly known as Semen Gresik, also plans to build packing plants in Bali and Lombok, according to Agung. He declined to detail more locations where the company may plan to build other plants.

Given the country’s archipelagic nature and its poor infrastructure facilities, securing a distribution chain is the key to the company maintaining its existence.

The company’s packing plants are located across the country, from Aceh on Sumatra Island and Ambon, Maluku, to Sorong, West Papua.

The packing plants bag the cement sent by Semen Indonesia’s closest cement factories.

Semen Indonesia currently has a total production capacity of 26 million tons per year. Semen Indonesia sold 22.48 million tons of cement to the domestic market last year, an increase of 14.7 percent compared to the year before.

The country’s cement demand reached 54.96 million tons last year, a 14.5 percent increase compared to a year earlier, according to figures from the Indonesian Cement Association.

Sales on Java rose about 14.6 percent to 30.38 million in 2012 year-on-year, according to the figures.

The country’s eastern regions reported a higher increase in cement sales last year compared to the national figure. Combined sales in Maluku and Papua reached 1.22 million tons, a 54.8 percent jump compared to a year earlier.

A second area that saw a marked increase was Kalimantan with sales totaling 4.08 million tons in 2012, a 21.3 percent rise compared to sales in 2011.

SMGR shares closed at Rp 15,450 apiece on Friday, 1.59 percent up compared to Rp 15,700 on Wednesday.

The bourse was closed for the Islamic holiday on Thursday. (Raras Cahyafitri/ The Jakarta Post)