Indonesia: ESDM plans to cut coal output to 600 mnt in 2026

• Coal output cut expected to help tackle oversupply, lift prices
• ESDM allows quota flexibility in Q1 to avoid supply disruptions

Mysteel Global: Indonesia plans to slash its coal production to around 600 million tonnes (mnt) in 2026, said Bahlil Lahadalia, Minister of Energy and Mineral Resources (ESDM), at a press conference on 8 January.

This is the latest official statement about the country’s coal production plans and was made about one month after the ESDM had said it expected 2026 coal production to fall below 700 million tonnes, as Mysteel Global reported.

“What is clear is that it will be around 600 million tonnes, although it could be slightly higher or lower,” Bahlil said, adding that the final figure is still being calculated by the Director General of Mineral and Coal.

The planned cut is aimed at easing structural oversupply and, by extension, lifting coal prices, the minister stressed.

“Globally traded coal is about 1.3 billion tonnes (for 2025), and Indonesia alone supplies 514 mnt, or 43%,” Bahlil said. “Under these conditions, supply and demand are not balanced, and prices are falling. That is why we will revise RKAB quotas and reduce production, to support healthy prices and to make sure these resources remain available for our grandchildren.” Indonesia’s ‘Work Plan and Budget’ document — known as RKAB — outlines a mining company’s production and sales volumes, as well as infrastructure development and community programmes.

For 2025, the ESDM expected Indonesia’s coal output to reach around 790 mnt, higher than the official target of 735 mnt, but well below the 2024 record of about 836 mnt. Of last year’s output, 514 mnt, or roughly 65%, were earmarked for export, 254 mnt, or 32%, for domestic consumption, and about 22 mnt, or 3%, for stockpiling.

Indonesia exported 472.79 mnt of coal in the first 11 months of 2025, down 7.8% y-o-y, according to the latest data from Statistics Indonesia.

To avoid supply disruptions during the transition, the ESDM earlier this week said that miners still awaiting approval of their 2026 RKAB quotas will be allowed to continue producing under their previously granted quotas until the end of March. However, their first-quarter output will be capped at 25% of their approved annual volumes, Mysteel Global reported.

Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.