Indonesia, the world’s largest coal supplier, is estimated to have exported about 437 MMT in 2021, expanding shipments by 30 MMT (+7%) y-o-y. This export figure is the second largest ever (459 MMT – 2019). Coal production in 2021 increased to 611 MMT (+48 MMT y-o-y) but did not reach the government’s target of 625 MMT due to unseasonably heavy rains and severe labor and heavy machinery shortages.

Indonesia’s shipments of thermal coal to China at an estimated 196 MMT (+68 MMT/+53% y-o-y) skyrocketed last year and now accounts for nearly half of all exports (31% in 2020), primarily due to the export ban on Australian coal. Conversely shipments to India fell by nearly 24 MMT y-o-y to 74 MMT by some distance the lowest figure for a decade. Exports to North Asia saw y-o-y declines, with combined shipments marginally below 65 MMT (-8.5 MMT/-12% y-o-y) whilst shipments to other countries in Southeast Asia at 90 MMT registered the first y-o-y fall for over 20 years.

Indonesia shipped more coal in 2021 via Panamax and Post-Panamax vessels, increasing these two sectors total share to 62% versus 54% in 2020. A consequence of less cargo being shipped to India the Supramax sector saw market share fall to 27% loading only 120 MMT in 2021 (-15 MMT/-11% y-o-y). The Indonesian government’s potential ban on coal exports would, therefore, especially impact on the Panamax market. Despite China’s current reliance on Indonesian coal, they have recently ramped up domestic coal production (at 4.01 BMT in 2021 up 7.7% y-o-y). With Chinese coastal coal trade likely to rise by around 60/65 MMT y-o-y in 2021 to 810/815 MMT, current Chinese stockpiles are now up by more than 50% y-o-y so China should now be able to withstand any temporary reduction in coal shipments from Indonesia.