Coal, nickel miners eye higher output in H2 after quota cuts

Mining companies in Indonesia are preparing to seek higher production quotas in the second half of 2026 after the government cut output allocations for key commodities under this year’s Work Plan and Budget (RKAB), Kontan reported.

The Ministry of Energy and Mineral Resources has set the national coal production quota at around 600 million tonnes for 2026, down from 790 million tonnes last year. Nickel ore output has also been capped at 250–270 million tonnes, significantly lower than the 379 million tonnes allocated in 2025.

Despite the reductions, some companies have yet to secure approval for their 2026 RKAB.

Gita Mahyarani, executive director of the Indonesian Coal Mining Association, said most members had received approvals, although many saw their requested quotas cut.

 “The national production target is entirely under the government’s authority. We view the current figures as part of a production control policy,” she told Kontan on Thursday.

The government has allowed companies to revise their RKABs in the second half, opening the door for potential quota increases.

Read also : Indonesia nears completion of nickel RKAB approvals, coal permits also advanced

Gita said the revision window could help balance supply controls with market opportunities as global demand improves.

 “Business players need room to respond to these opportunities in a measured way,” she said, noting coal prices are currently around $127.75 per tonne.

Nickel miner PT Central Omega Resources Tbk is among companies planning to request higher quotas. The company has cut its 2026 nickel ore sales target to about 1.03 million wet metric tonnes, in line with its approved RKAB, down sharply from 3.02 million tonnes in 2025.

Director Andi Jaya said the company would first maximise output under its current quota before seeking an increase in the second half to return to around 3 million tonnes annually.

 “We will operate at full capacity based on the RKAB we have received, so hopefully in the second semester we can secure additional quota,” he said during a public presentation.

He added that strong demand from domestic smelters supports the case for higher production, although last year’s oversupply had weighed on global nickel prices.

Industry groups have warned that lower quotas could impact employment.

Hendra Sinadia of the Indonesian Employers Association said some companies may only have sufficient production allowances through May, raising the risk of layoffs.

Rizal Kasli of the Indonesia Mining Experts Association said reduced output would also lower utilisation of equipment and labour.

 “Every 1 million tonne reduction in production could affect around 400 to 500 workers,” he said.

Editing by Reiner Simanjuntak