Indonesian Coal Group Hopes for 600MT Coal Production in 2020

Indonesia’s coal miners association expects the government to increase the coal production quota to 600 million tons (MT) in 2020, up from 489.73MT targeted this year - Photo by InsiderStories.

JAKARTA (TheInsiderStories) – Indonesia’s coal miners association, locally known as APBI, expects the government to increase the coal production quota to 600 million tons (MT) in 2020, up from 489.73MT targeted this year. Until the end of the year, coal production is expected to be above 500MT.

“I think this year’s target will be achieved. According to government data until the third quarter of this year, the realization has reached 390.15MT or 79.67 percent of the target of 489.73MT. So for next year, we hope that production can reach 600MT,” said APBI’ executive director Hendra Sinadia in Jakarta on Wednesday (11/27).

He added the realization of coal production always exceeded the target set by the government. Even last year, the realization of new coal production was above the target set of 489MT. At the end of 2018, production reached 557.77MT as well as a record of domestic production, he noted.

Sinadia said that although the current coal price tends to decline, he believes from the fourth quarter to the beginning of next year it will skyrocket driven by the peaceful sentiments of the United States (US) – China trade war. On the other hand, he continued, at this time the supply began to decrease due to several small and medium scale mines began to collapse, so that the potential to hoist coal prices.

“Supplies will decrease and prices will rise again, which is normal as a cycle. At present prices are indeed likely to decline due to weak demand. But we expect recovery after the cessation of the US-China trade war,” he said.

Meanwhile, the government has set the coal benchmark price for November at US$66.27 per tonne, an increase from $64.80 per tonne a month earlier. It said October’s price was the lowest since September 2016. The price rose slightly compared with a month earlier because there was some increase in demand for winter, the energy ministry document showed.

Written by Lexy Nantu, Email: lexy@theinsiderstories.com