Mineral-energy-international.com, Indonesia’s Ministry of Energy and Mineral Resources (ESDM) has approved coal production quotas totaling 922.14 million tonnes (mnt) for the current year. This decision aligns with the approval of the Work Plan and Budget (RKAB) for 587 companies, covering the period from 2024 to 2026, as reported by Bambang Suswanto, the acting director general of Mineral and Coal at the ESDM. Out of the 883 coal companies that applied for the RKAB, 121 applications were rejected, though 100 of these are undergoing re-evaluation, which may lead to an increase in the final production quotas for 2024.
The approved production quotas for 2024 exceed the ESDM’s earlier annual target of 710 mnt, raising concerns about potential shortages in the global supply, given Indonesia’s significant role as a leading thermal coal exporter. Market analysts are predicting a substantial rise in the country’s coal output, driven by the capacity of large miners to ramp up production thanks to well-established infrastructure.
Despite the expectation of increased production, logistical challenges may limit coal exports. Deficiencies in mining infrastructure, transportation, and port loading capacity could act as bottlenecks, constraining Indonesia’s ability to fully capitalize on its production potential. As a result, total production could fall short of the approved quotas, with forecasts suggesting output could settle between 830 and 850 mnt this year.
In addition to these logistical challenges, demand uncertainties persist. Traditional buyers such as China and India, which have long been major importers of Indonesian coal, are working to increase their own domestic supplies. This shift in demand dynamics could impact the extent to which Indonesia can export its coal, further complicating the global market outlook.
Domestically, Indonesia’s rapidly growing economy and the construction of the new capital city are expected to drive increased energy consumption, encouraging miners to boost coal production for local use. While export growth may be limited, domestic demand could provide a buffer, sustaining production and helping Indonesia meet its ambitious energy goals for 2024.