Coal Exports Only Reaches 58% of Target as of October

Indonesia's coal industry has been seriously hit by the COVID-19 pandemic, which has caused the consumption of this commodity to plummet. As a result, Indonesia's coal exports took a sharp drop. "This year's export target is 395 million tons, as of October only 58.81 percent or 232.3 million tons," Coordinating Minister of Economic Affairs Airlangga Hartarto said on Tuesday (10/27).

Apart from exports, falling consumption also means that the absorption of the 2020 Domestic Market Obligation (DMO) will not reach the target. Airlangga projected that the realization of DMO until the end of the year would only be 141 million tons or 91 percent of this year's target of 155 million tons. As a result, investment in the country has declined. "The investment target [mineral and coal sector] for this year is US$7.7 billion, and only 27.16 percent or US$2.1 billion has been realized," Airlangga said.

According to the Director-General of Mineral and Coal at the Energy and Mineral Resources Ministry (ESDM), Ridwan Djamaluddin, the coal industry faces tough challenges. In addition to the COVID-19 pandemic, which resulted in a decline in national production due to falling demand, the coal industry was hit by falling commodity prices. Moreover, restrictions to access and employee mobility and facilities that support operations also pose another challenge to the industry.