Indonesian Ministry of Energy and Mineral Resources remains optimistic that Indonesia's coal production target for 2025 will be achieved, despite ongoing pressures from declining export volumes and falling prices.
The ministry projects national coal production this year will surpass 700 million tons.
“By year-end, we project production will reach over 700 million tons,” said Tri Winarno, Director General of Mineral and Coal (Minerba) at the ESDM Ministry, on Thursday (August 7, 2025), as reported by Kontan.
According to data from Minerba One Data Indonesia (MODI), as of August 7, national coal production had reached 430.77 million tons—58.25% of the annual target of 739.56 million tons.
Export sector under pressure
While domestic production remains strong, the export sector continues to face headwinds. The Central Statistics Agency (BPS) reported that coal export revenues for the first half of 2025 totaled US$11.97 billion, down 21.09% year-on-year (YoY).
Export volumes also declined 6.33% YoY to 184.19 million tons, with the average export price falling 15.86% to US$64.99 per ton.
Hendra Sinadia, Executive Director of the Indonesia Mining Association (IMA), noted that the downturn had been anticipated, as coal production and exports in 2025 were expected to be lower than in 2024.
He attributed the trend to global oversupply, particularly from major producers such as China, India, and Mongolia—a condition likely to persist through 2026.
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“The global thermal coal market has been oversupplied since 2024 and is expected to remain so until at least 2026,” Hendra said. “China and India both recorded their highest-ever coal production levels in 2024.”
He added that redirecting coal exports to new destinations is not straightforward, as many importing countries are increasing their own production.
“The largest markets for thermal coal remain China, India, East Asia, and Southeast Asia,” he said.
Export target lower than 2024
The Indonesian Coal Mining Association (APBI) has set the country’s coal export target for 2025 at 500 million tons, lower than the 555 million tons achieved in 2024.
“This year’s export target is 500 million tons, or 67.6% of total production. As of June 2025, we’ve exported about 238.64 million tons, or 47.7% of that target,” said Gita Maharani, Acting Executive Director of APBI.
Gita noted that nearly 60% of Indonesia’s coal exports to China consist of low-calorie coal with a calorific value of 3,000–4,200 GAR.
However, shifting demand from importers is complicating matters. According to the Indonesian Mining Professionals Association (Perhapi), Chinese buyers are now favoring high-calorie coal due to price declines.
“Buyers in China are shifting from low- to high-calorie coal because lower market prices allow them to get better energy content at a reduced cost,” said Perhapi Chairman Sudirman Widhy.
Sudirman warned that unless China’s purchasing preferences change, Indonesia will continue to face coal export challenges for the remainder of the year.
“If the current situation in China persists, the 500 million ton export target will be difficult to achieve,” he concluded.
Editing by Reiner Simanjuntak
