MEMR still evaluating coal, nickel quota revisions as miners seek higher output

By Calvin Purba

The Ministry of Energy and Mineral Resources (MEMR) has yet to determine the extent of potential revisions to coal and nickel production quotas under companies' Work Plans and Budgets (RKABs), despite the upcoming review period scheduled to begin in July.

Tri Winarno, Director General of Mineral and Coal, said the government was still evaluating requests and market conditions before deciding whether to adjust approved production levels.

"We are still conducting evaluations," Tri said on Monday. "I cannot say yet."

The government has so far approved RKABs covering around 600 million metric tons of coal production and approximately 250-260 million tons of nickel ore output for 2026, significantly below last year's levels.

Indonesia initially planned to reduce coal production to around 600 million tons in 2026 from about 790 million tons in 2025, while cutting approved nickel ore output to roughly 260-270 million tons from around 379 million tons, as part of efforts to support global commodity prices and improve market balance.

However, the government recently signaled a willingness to revisit production limits, particularly for coal, amid stronger commodity prices and evolving market conditions.

Several nickel miners are preparing to submit RKAB revision requests in July to secure additional ore production quotas for the second half of the year. Among them are Indonesia Weda Bay Industrial Park (IWIP), PT Central Omega Resources Tbk (IDX: DFKT), and PT Vale Indonesia Tbk (IDX: INCO).

Despite the expected review process, Cecep Mochammad Yasin, Director of Mineral Business Development at the ministry's Directorate General of Mineral and Coal, said the approved nickel ore production target currently remains unchanged at around 260-270 million tons.

The quota reductions have raised concerns among downstream nickel producers, with several smelters reportedly operating at less than half of installed capacity due to shortages of nickel ore supply.

In the coal sector, producers and mining contractors are also feeling the impact of lower production approvals.

PT United Tractors Tbk (IDX: UNTR), Indonesia's largest heavy equipment distributor and mining contractor, has lowered several of its 2026 business targets, citing reduced mining production quotas and continued pressure on the domestic mining industry. The company reported a sharp decline in first-quarter earnings, weighed down by the absence of gold sales and weaker demand across its construction machinery and mining contracting businesses.

Coal miner PT Baramulti Suksessarana Tbk (IDX: BSSR) is targeting coal production of 17 million tons in 2026 and hopes to secure additional government-approved quotas later this year to meet that target, according to its president director. The company's current approved RKAB stands at around 11 million tons. It produced 17.84 million tons of coal in 2025.

Concerns over the impact of lower production quotas have also extended to employment.

Arismunandar, Head of Industrial Relations and Workers' Social Security at East Kalimantan's Manpower and Transmigration Office, said several mining companies had informed the regional government of plans to reduce their workforce.

"Several companies have already notified us, including companies from Bayan Group and PT BAS," Arismunandar said.

Industry groups have previously warned that lower production quotas could affect mining contractors, transport operators, equipment suppliers and other businesses linked to Indonesia's coal industry.

Editing by Reiner Simanjuntak