Indonesia’s thermal coal export shipments remained largely unchanged in August at 31 million tonne (mnt) amid mixed buying appetite of countries, CoalMint’s vessel line-up data revealed.
Despite stable Indonesian coal prices last month, shipments to India, Malaysia, Japan, and Vietnam took a hit, while exports to China, South Korea and Pakistan gained strength.
Shipments to India fell sharply by 18% m-o-m to 9.1 mnt last month amid heavy rainfall in the country that lowered booking volumes and as the government annulled its 10% blending directive for power plants.
With improving coal inventory at domestic utilities and steady domestic production, power companies focused on domestic coal sourcing. Coastal power plants, on the other hand, that are predominantly based on imported fuel, made limited purchases as Indonesian miners offered premiums.
Exports to Japan fell by 18% amid higher imports from Australia as Japanese buyers signed a long term contract (LTAs) with Australian suppliers for 2022 at a whopping $375/t.
Exports to Malaysia and Vietnam fell by 18% and 20% respectively as power utilities were yet to begin their winter restocking activity.
Trade balancing
*Qty in mnt
Exports to China rise amid intense heatwave
Indonesian thermal coal exports to China rose sharply by 37% in August amid an intense heatwave and a sharp fall in hydropower generation in the country.
The enquiries were mainly focused on the low-CV category due to the rising blending demand with cost-competitive high-CV Russian material. Mid-CV Indonesian coal demand has declined sharply following Beijing’s cap on their domestic 5500 kcal/kg NAR coal at RMB 570-850/t ($83-123/t), which is $40/t cheaper over the similar Indonesian grade.
Interestingly, the stable coal prices in Indonesia last month led to higher exports to the Philippines, South Korea, Hong Kong, and Pakistan.
Higher power demand in Pakistan resulted in Indonesian coal exports to the country rise by 105% last month with lower shipments from neighbouring Afghanistan.
The Indonesian coal export ban on 48 mining companies early last month also had limited impact on its prices and export volumes as large-scale miners that had fulfilled the domestic market obligation continued to cater to overseas demand.
Short-term outlook
Indonesian coal exports are seen gaining strength in the coming months with the strong winter restocking demand in Asia and Europe. Indonesian miners have been trying to find ways to increase shipments to Europe, as per government officials.
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