Business Prospects
Based on observations by the International Energy Agency (IEA), global coal trade in 2024 was projected to decline, along with the increase in nuclear power generation capacity in China, India, and the European Union. This step, supported by the global commitment to climate change mitigation through the Paris Agreement, encourages the acceleration of energy transition from coal to more sustainable renewable energy.
Nevertheless, amid the overall decline in global demand, Indonesia remained optimistic by targeting coal production of 922 million tons in 2024. Of this amount, the domestic market obligation (DMO) was set at 220 million tons, to ensure the availability of coal supply for the electricity sector and domestic industry. This target is also in line with the government’s plan to support the 35 GW power plant project development program and increase national industry’s capacity.
As one of the world’s major exporters of thermal coal, demand for Indonesian coal from the Asian market was projected to remain strong. For the first 2 months of 2024, Indonesia’s coal shipment volume increased by almost 20% compared to that of the same period in 2023. This growth was driven by the increasing need for coal in China, especially to support the supply chain of building materials and spare parts industries. In addition, demand from Vietnam also showed a positive trend, with a significant increase for the needs of cement and steel factories, which experienced a production surge.
Nonetheless, the challenges of global energy transition remain a major concern. Efforts to manage the sustainability of coal sector in Indonesia continue to be carried out, through the application of low-emission technology and market and product diversification. These steps are expected to maintain the significant contribution of coal sector to the national economy, while supporting the achievement of environmentally friendly energy targets.
Company’s 2025 Projection
The Company targets a production volume of around 50-55 million tons in 2025, while sales volume is around 51-56 million tons.