Kideco sees demand for Indonesian coal strong despite economic slump

Demand for Indonesian subituminous coal will keep increasing despite the world economic slowdown, according to an industry player.

?The current trend in power generating firms is to add more subituminous coal in the blending to cut electricity generating cost down. Power generating companies in Japan, Korea and Taiwan will reduce their import of bituminous coal from Australia, which is more expensive, and import more from Indonesia,? Kim Dong Sook, managing director of one of Indonesia?s top coal producer PT Kideco Jaya Agung told Petromindo.com in an interview recently.

?Power generating companies from Taiwan and South Korea for instance, had increased their buying volume from Kideco in 2002,? he said.

He therefore predicted that the market would easily absorb the 11 million tons of coal Kideco would produce in 2002

?The same is also true for Adaro Indonesia and Berau Coal,? he said.

An industrial analyst who declined to be named agreed with Kim?s view saying that the current global economic slow down would not stop Indonesian coal mining companies to expand capacity in 2002. The analyst predicted that Indonesia would be able to produce in excess of 90 million tons of coal in 2002.

Indonesia is expected to produce more than 80 million tons of coal in 2001, 65 million tons of which would be exported.(alex)