Indonesia's Coal Exports Decline Amid Global Market Shifts
Indonesia, the world's largest exporter of thermal coal, has experienced a significant decline in coal exports in 2025. Shipments from January to April totaled approximately 160 million tonnes, marking a 6.43% decrease compared to the same period in 2024 . This downturn is attributed to weakened demand from major importers and global market shifts.
Admin
6/2/20251 min read
Factors Contributing to the Decline
1. Reduced Demand from Major Importers
China: Imports from Indonesia dropped by 20% year-on-year in April, influenced by increased domestic coal production and efforts to reduce air pollution
India: Similarly, India's imports decreased by 15%, as the country boosts its own coal output to meet energy needs .
2. Global Shift Towards Renewable Energy
Many countries are transitioning to cleaner energy sources, leading to a 3% year-on-year decline in coal-fired electricity production across Asia in the first quarter of 2025
3. Price Disputes and Market Dynamics
Indonesia's adoption of the new government-set coal price benchmark, Harga Batubara Acuan (HBA), has faced resistance from buyers, particularly in China, who prefer the Indonesian Coal Index (ICI). Critics argue that HBA is less transparent and results in higher prices, potentially deterring purchases
Impact on Global Coal Market
The decline in Indonesia's coal exports has contributed to a global oversupply, pushing thermal coal prices to a four-year low . This price drop affects the competitiveness of coal compared to other energy sources and has implications for global energy
Outlook
Unless significant changes occur, such as increased demand or policy shifts, Indonesia's coal export levels may remain subdued. This trend could signal a peak in global coal flows, as countries continue to move towards sustainable energy solutions.
