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Indonesian miners sign $1.46B China coal deal
The Indonesian Coal Mining Association (APBI) on November 25 signed a deal with the China Coal Transport and Distribution (CCTD) association to export $1.46 billion worth of coal to China next year.
The value is low compared to that of realised exports this year, but the APBI said in a joint statement with the Ministry of Energy and Mineral Resources on November 26 that it hoped the deal would translate into 200 million tonnes of coal exports to China next year.
Ministry spokesman Agung Pribadi said: “This presents a positive opportunity to realign production levels to the expected projections.”
The ministry expects Indonesia to export 461 million tonnes of coal worldwide next year whereby China, as Indonesia’s biggest coal buyer, plays a key role in meeting that target.
The ministry in November 26’s statement noted that Indonesian coal exports to the East Asian country reached $4.9 billion up until September this year, a bigger figure than the deal value.
Coal demand collapsed this year, resulting in the Indonesian benchmark coal price plummeting to a five-year low of $49.42 per tonne in September, before recovering to $55.71 per tonne in November, ministry data show.
Nonetheless, the price remains weaker than the average $77.89 per tonne last year with experts predicting prices to remain below 2019 levels throughout next year.
APBI chairman Pandu Sjahrir said: “With this deal, coal miners are optimistic for 2021 even though the global coal market is not expected to recover to 2018-2019 levels.”
The deal signing ceremony was attended by several big names in the coal mining industry including PT Adaro Energy, PT Kideco Jaya Agung and PT Toba Bara Sejahtra, as well as Coordinating Maritime Affairs and Investment Minister Luhut Binsar Pandjaitan.
THE JAKARTA POST/ASIA NEWS NETWORK