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Indonesia has banned coal exports in January due to concerns that low supplies at domestic power plants could lead to widespread blackouts, a senior official at the energy ministry said on Saturday.
The Southeast Asian country is the world’s biggest exporter of thermal coal, exporting around 400 million tonnes in 2020. Its biggest customers are China, India, Japan and South Korea.
Indonesia has a so-called Domestic Market Obligation (DMO) policy whereby coal miners must supply 25 per cent of annual production to state utility Perusahaan Listrik Negara (PLN) at a maximum price of $70 per tonne, well below current market prices.
In the letter cited by local media Kumparan, the ministry instructed that all coal at harbours should be stored to supply power plants and independent power producers (IPP).
“The export ban will be evaluated and reexamined based on the stock realisation of coal for PLN’s power plants and IPP,” the letter said.
Ahmad Zuhdi Dwi Kusuma, an industry analyst at Bank Mandiri, said the ban would push global coal prices higher in coming weeks as stockpiles decrease.
(TDS)
