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Coal production down in Indonesia

Published by
World Coal,

As a result of decreased global coal demand, coal miners in Indonesia have reduced coal production. For the first eight months (January-August) of 2015, production declined 15.4% to 263 million t whereas in the same period in 2014, it produced 311 million t.

According to the Indonesian Coal Mining Association (APBI) last month, almost 80% of Indonesian coal miners have temporarily ceased coal production as the production cost margin turned negative. The Indonesian government also cut the nation’s coal production target in 2015 from 425 million t to 400 million t.

Indonesia is the largest global thermal coal exporter. Its reference thermal coal price came in at a low of US$58.21/t, declining 1.6% from the August reference rate and was the fifth consecutive month of decline. Additionally, Indonesia’s coal exports saw a fall of 18% to 211 million t y/y in the January to August period.

The September reference thermal coal price declined 8.8% compared to the January reference price of US$63.84 per t.

The domestic coal consumption has been fairly steady so far in 2015. Through January to August, 52 million t were consumed domestically – predominantly by power plants and the industrial sector. Yet, this is a decline of 1 million t compared to the same time in 2014.

Edited from press release by Harleigh Hobbs

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