Business
Indonesian coal exports fell 23.3 percent in August
The Hindu BusinessLine·
Fitch Ratings said Asian thermal coal prices are likely to stay elevated for months. Indonesian export uncertainty and lower Chinese production are tightening supply. Drought linked to El Nino restricted barging on the Barito River. Indonesian coal exports fell 23.3 percent year on year in August and 18.1 percent in September. Gas-to-coal switching in Japan and South Korea supports demand.
Prism
What It Means For You
- Higher near-term prices can strengthen coal miners' cash flows and debt-servicing capacity, Fitch said.
- Power demand growth of 5-7 percent in India and Southeast Asia continues to support coal use there.
- Longer term, Fitch still expects declining Chinese and Indian import demand to pressure the sector.
What's Happening
- Some Indonesian producers declared force majeure after failing to secure mining quotas or facing logistics bottlenecks.
- China's national raw-coal output fell 10.1 percent year on year in July and 7.7 percent in August.
- Production was down 3.3 percent in the first eight months of 2026 after tighter Shanxi safety checks.
Policy And Quota Uncertainty
- Indonesia eased an initial 2026 production target of 600 million tonnes after 790 million tonnes of actual 2025 output.
- Fitch flagged 2027 quota allocation, a single-door export policy and domestic market obligations as ongoing constraints.
- Chinese thermal power generation rose just 0.9 percent in the first eight months of 2026 as renewables grew.
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