APBI sees moderate coal prices as supply risks cap gains
Saturday, March 21 2026 - 11:08 PM WIB
Indonesia’s coal prices are expected to remain relatively moderate with limited upside despite recent gains, as global market dynamics and planned increases in domestic output cap further rallies, the Indonesian Coal Mining Association (APBI) said on Friday.
APBI said the market remains segmented, with stronger price gains concentrated in higher-calorific coal, while lower- to mid-calorific grades are likely to stay stable.
“Although geopolitical tensions could push up energy commodity prices, the impact on coal will not be uniform and is likely to be limited,” Executive Director Gita Mahyarani said, as quoted by Bloomberg Technoz.
She added that prices could come under pressure if global supply rises significantly, noting that additional output does not automatically translate into sharp price increases under current market conditions.
Coal prices have recently climbed above $140 per tonne, supported by disruptions in oil and gas markets linked to escalating tensions in the Middle East, prompting several countries to increase coal-fired power generation.
Read also: Indonesia to raise coal output in 2026 on Prabowo’s directive amid price rally
Indonesia, the world’s largest thermal coal exporter, is moving to raise output in 2026 following a directive from President Prabowo Subianto, reversing an earlier plan to curb production.
Coordinating Economic Affairs Minister Airlangga Hartarto said the government would revise miners’ production quotas under the 2026 Work Plan and Budget (RKAB) to increase volumes, aiming to benefit from firmer prices.
The policy shift is also intended to boost state revenue and capture potential windfall profits from higher commodity prices, as the government seeks to offset pressure on the state budget.
Earlier, the Energy and Mineral Resources Ministry had planned to cut the 2026 coal production target to around 600 million tonnes, roughly half of the approved RKAB level of about 1.2 billion tonnes in the previous year.
However, Director General of Minerals and Coal Tri Winarno said any adjustment to output targets would be made proportionally, taking into account each company’s contribution to non-tax state revenue.
Gita said other factors, including freight costs, oil prices and import policies in destination countries, would also influence coal price movements going forward.
Editing by Reiner Simanjuntak