Indonesia: Thermal coal exports fall 9% in April as shipments to key buyers decline

Indonesia’s total thermal coal exports witnessed a 9% m-o-m decline to 32.4 million tonnes (mnt) in April 2022 as elevated prices and logistic disruption weighed on export sentiments, CoalMint vessel line-up data revealed.

Shipments to its key export destinations like Japan, China, India and the Philippines recorded a sharp fall last month.

However, shipments to other countries including South Korea, Taiwan, Vietnam, and Pakistan rose in April.

Trade balancing

*Qty in mnt, exports to EU has been included in others

Although the percentage varies in the above table, in absolute terms, the fall in exports to key countries was higher than the rise in exports to other countries, resulting in a net drop in Indonesian coal exports in April.

However, although not substantial, Indonesian coal exports to European countries have been seen at 0.19 mnt in April amid the Russia-Ukraine crisis.

Why did exports to key buying countries drop?

Export shipments to China fell by 10% last month as Chinese traders deferred major import bookings amid strict lockdown restrictions in the country and record-high coal production during the first three months of the year.

Shipments to India also fell by 14% as end-users awaited a correction in coal prices before making any major bookings. With the ongoing domestic coal supply crunch back home, a sharp fall in Indonesian shipments was also limited.

A sharp rise in Indonesian 5800 kcal/kg GAR grade coal prices in March and April, ever since Russia launched invasion into Ukraine, also weighed on exports to the Philippines and Japan by 17% and 27% respectively.

Shipments to other Asian countries rise

Elevated LNG prices amid limited availability of the same also increased the dependency of several countries on coal which lifted export shipments to Taiwan, Vietnam, and Pakistan last month.

Amid the ongoing summer season, power demand has increased sharply in these countries with several parts of Pakistan even reporting 6-10 hours of power outage.

Short-term outlook

With the ongoing strong coal demand across the globe, Indonesian export shipments are likely to remain higher in the upcoming months. Demand from India is also rising as buyers have started making bulk purchases amid stable Indonesian prices since past few weeks.