Indonesia Cement Demand Rises 10.2% in H1 2026 Amid Overcapacity
Indonesia cement demand recovered in the first half of 2026, up 10.2% to 29.9 million tonnes, but the industry still struggles with far more capacity than the market needs.
Indonesia's cement industry saw demand recover in the first half of 2026. According to Kontan, domestic cement demand rose 10.2% year on year to 29.9 million tonnes in H1 2026, helped by stronger construction activity during the dry season.
Selling prices are recovering
In a research note dated 9 October 2026, Binaartha Sekuritas analyst Eka Rahmawati Rahman said PT Semen Indonesia (SMGR) raised prices twice in H1 2026. Its average domestic selling price rose 6.9% and its export price 15.0%, while its domestic market share held at about 46.2%. In the second half, government projects such as Sekolah Rakyat schools, Koperasi Merah Putih cooperatives, Kampung Nelayan fishing villages and toll roads are expected to contribute more. Demand is described as stronger in Sumatra, while Kalimantan faces headwinds from slower construction at the new capital, IKN.
The structural problem: overcapacity
Despite higher sales, Lilik Unggul Raharjo, chairman of the Indonesian Cement Association (ASPERSSI), told Bisnis.com that national capacity is about 120 million tonnes a year. Utilisation in 2025 was estimated at only around 54% and is projected to edge up to about 56% in 2026, far below the ideal 80–85%. Overcapacity makes it hard for producers to raise prices, while energy, electricity, raw material and logistics costs keep squeezing margins.
ASPERSSI expects bulk cement to depend more on infrastructure and large construction projects, while bagged cement depends on house building, small and medium projects and home renovation, as long as purchasing power holds.
Competition is intensifying
Kontan also noted that through August 2026 the two largest producers grew volumes by 6%, while the rest of the market grew 17%. For buyers, this means more brand choice. The key is to choose the right cement type for the job and make sure the product carries the SNI mark.
Where homeX fits in
As a one-stop building materials and furniture service platform in Indonesia, homeX follows these developments closely. With a showroom, warehousing and delivery based in Tangerang, we aim to help contractors, building-material shops and homeowners get materials of clear quality, visible stock and deliveries they can plan around.
FAQ
How much cement capacity does Indonesia have? ASPERSSI puts national capacity at about 120 million tonnes a year, with utilisation of only about 54% in 2025 and a projected 56% in 2026, well below the ideal 80–85%.
Did cement prices rise in 2026? Semen Indonesia (SMGR) raised prices twice in H1 2026; its average domestic selling price rose 6.9% and its export price 15.0%.
Indonesia cement demand: related articles and products
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- Cement Types in Indonesia: OPC vs PCC vs PPC and When to Use Each
- Cement Price per Bag Hits Rp75,000–85,000 as Bima, West Nusa Tenggara Runs Out for Two Weeks
- Low-Carbon Cement and Steel Take Centre Stage in Indonesia's Green Public Procurement
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Source: Bisnis.com, 22 Jul 2026; Kontan via TradingView, Okt 2026; Kontan.co.id