Coal Recovery Too Good to Resist for World’s Biggest Shipper – by Fitri Wulandari and Eko Listiyorini (Bloomberg News – January 13, 2017)

https://www.bloomberg.com/

Indonesia will exceed its coal production target for another year as miners cash in after prices recovered from a five-year collapse.

The world’s biggest exporter will produce about 489 million metric tons this year, 18 percent above the government-mandated target, according to energy ministry forecasts. That’s up from last year’s output estimated at 434 million tons and would be at least the third year in a row that the nation has produced more than it planned.

Southeast Asia’s largest economy has been trying to cap its coal output in an attempt to preserve resources for future generations of Indonesians. That’s proving a challenge as resurgent prices tempt producers to maximize output from new and existing mines to meet demand at home and abroad.

“Actual annual production will generally be higher than targeted because prices are now higher,” Bambang Gatot Ariyono, the director general of coal and mineral resources at the energy and mineral resources ministry, said Jan. 5. “It compensates for previous losses.”

Coal more than doubled in 2016 after tumbling to the lowest in almost a decade as efforts by China to reduce excess supply pushed prices higher and faster than anyone anticipated. The recovery is breathing new life into an industry hammered by overcapacity and shrinking demand, reviving share prices of miners around the world, from Indonesia’s PT Bumi Resources to Australia’s Whitehaven Coal Ltd.

For the rest of this article, click here: https://www.bloomberg.com/news/articles/2017-01-12/coal-s-recovery-too-good-to-resist-for-world-s-biggest-exporter

Comments are closed.