Bumi Resources expects 40% cut of 2012 output

By Hiski Darmayana

IDX-listed Bumi Resources Tbk expect to produce around 60 million tons of coal this year, down from previously set output target of 100 million tons.

"The current bearish market forces us to revise our production target for this year," the company's investor relation vice president and chief economist Achmad Reza Widjaja told Petromindo.com recently, adding that despite the cut, 2013 output is certain to be higher.

"In addition, Chinese market is slowing down and they have temporarily stopped their coal imports," Reza said without giving further detail.

80 percent of the company's coal are sold on long term contracts at the average selling price of US$80 per ton, while the remaining 20 percent is sold on spot market to mostly Japanese buyers. Both Japan and Taiwan are expected to become the company's main market in the future following Japan's plan to replace nuclear power plants with coal.

Editing by Er Audy Zandri