Indonesia’s construction sector is the fourth-largest contributor to the economy. Driven by the current government’s ambitious infrastructure plans, including the megaproject of Nusantara development, large-scale infrastructure developments have become the norm in the archipelago. Supported by its strong manufacturing sector, Indonesia's construction materials market is anticipated to grow significantly over the coming years.
Indonesia has the world's largest nickel production and reserves, highlighting its importance in the global nickel trade. In 2023, Indonesia produced half of the world’s nickel mines. Simultaneously, global demand for steel products – where most nickel production goes – keeps rising every year. Indonesia is currently one of the world's largest stainless-steel exporters. With more than 28 billion U.S. dollars worth of iron and steel exports in 2022, this metal is also one of Indonesia’s most in-demand export products.
Apart from nickel, Indonesia also has an abundance of copper. The Grasberg mine in Papua is the second-largest copper mine in the world that is operated by PT Freeport Indonesia. It has one of the largest reserves of copper globally, with recovery rates reaching 90 percent. After the Indonesian government acquired most of PT Freeport Indonesia's shares in 2018, the company was required to build a second smelter following Indonesia's mining regulations, which demand that mineral ores be processed domestically. The new facility is anticipated to produce 1.7 million metric tons of copper concentrate annually.
Moreover, Indonesia is one of the world's largest producers of timber. It also exports a wide variety of timber products, such as plywood and veneer, that are widely used for construction purposes. Indonesia's wood manufacturing sector is among its largest employment sectors.
Raw and processed building materials in Indonesia
Given the growth rate of the construction industry in Indonesia, there is a high demand for building materials, particularly cement. Indonesia's cement producers have boosted annual production in the past few years. Its largest cement producer, state-owned Semen Indonesia, has increased its annual cement production capacity by over 50 percent since 2017. Accordingly, Indonesia ranked as one of the leading cement-producing nations in the world.Indonesia has the world's largest nickel production and reserves, highlighting its importance in the global nickel trade. In 2023, Indonesia produced half of the world’s nickel mines. Simultaneously, global demand for steel products – where most nickel production goes – keeps rising every year. Indonesia is currently one of the world's largest stainless-steel exporters. With more than 28 billion U.S. dollars worth of iron and steel exports in 2022, this metal is also one of Indonesia’s most in-demand export products.
Apart from nickel, Indonesia also has an abundance of copper. The Grasberg mine in Papua is the second-largest copper mine in the world that is operated by PT Freeport Indonesia. It has one of the largest reserves of copper globally, with recovery rates reaching 90 percent. After the Indonesian government acquired most of PT Freeport Indonesia's shares in 2018, the company was required to build a second smelter following Indonesia's mining regulations, which demand that mineral ores be processed domestically. The new facility is anticipated to produce 1.7 million metric tons of copper concentrate annually.
Moreover, Indonesia is one of the world's largest producers of timber. It also exports a wide variety of timber products, such as plywood and veneer, that are widely used for construction purposes. Indonesia's wood manufacturing sector is among its largest employment sectors.
