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SAFETY4SEA

Indonesia permits some coal exports after 10-day ban

by The Editorial Team
January 12, 2022
in Fuels
Indonesia palm oil ban

Credit: Shutterstock

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Indonesia allowed 14 vessels loaded with coal to depart as soon as they secure verifications from mining and transport authorities, a senior minister told Reuters, easing an export ban by the world’s top thermal coal exporter.

Namely, Coordinating Minister of Maritime and Investment Affairs Luhut Pandjaitan said in a statement:

As of today, after seeing a much better supply condition at PLN, 14 vessels that have already been fully loaded with coal and have been paid by the buyers, can be immediately released for export.

To remind, the export suspension on Jan. 1 came after state power utility PLN reported critically low inventory levels of the fuel, sending global coal prices higher last week and prompting calls by Japan, South Korea and the Philippines for it to be eased.

What is more, the government will conduct a review today, where if it decides to scrap the ban, it will do so gradually as it considers how the resumption affects compliance with the so-called Domestic Market Obligation (DMO) rules, Luhut added.

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Under the DMO rules, miners are required to sell 25% of their output to local market with a maximum price of $70 per tonne for domestic power plants.Luhut has said the government will come up with a new formula for the pricing so PLN would pay at market price.

Such a formula may involve collecting a coal levy, the statement said, with authorities set to discuss the plan in a week. read more

Authorities will evaluate the DMO compliance every month, the statement added.

Indonesia Coal Miners Association executive director Hendra Sinadia said the group appreciated the easing of the export ban and would comply with the government’s decisions.

Tags: bancoalexportsIndonesiashipping trade

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