Indonesia is taking a cautious approach to relaxing mining production quotas under the revised 2026 Work Plan and Budget (RKAB), Energy and Mineral Resources Minister Bahlil Lahadalia said, as coal and nickel producers await government approval for their updated plans.

The Ministry of Energy and Mineral Resources (ESDM) has received revised RKAB proposals submitted by mining companies during the July submission period. The revisions are now under evaluation, with industry players waiting for clarity on additional production allowances.

Bahlil said on August 3 that the government would implement any quota adjustments in a measured manner, taking into account domestic demand, supply-demand conditions and the potential impact on global commodity prices.

He declined to disclose the size of any potential quota increases, saying such information could influence market sentiment and prices, particularly for coal and nickel.

"There are (changes to the production quota in the 2026 RKAB), but don't ask me how much. Because once I announce it, prices could fluctuate again," Bahlil was cited by Kontan as saying.

Indonesia is a major player in global commodity markets, accounting for around 43% of global seaborne coal trade of about 1.3 billion tonnes, Bahlil said. He added that nickel prices were also highly sensitive to changes in Indonesia's ore production quotas.

Bahlil cited a previous market reaction when speculation over a relaxation of nickel ore quotas pushed nickel prices lower, from around $18,000/t to $17,000/t.

The minister also said quota allocation would consider the contribution of mining companies to state revenue, including royalty payments.

He added that companies paying higher royalty rates could receive priority in quota approvals to help the government maximize revenue while maintaining production levels.

Under Energy and Mineral Resources Ministerial Regulation No. 17 of 2025, mining companies are allowed to submit RKAB revisions after filing periodic reports through the second quarter, or no later than July 31.

Coal and nickel industry groups said they were still waiting for approval results and urged the government to balance production targets with domestic supply obligations, export commitments and long-term industry sustainability.

The Indonesian Coal Mining Association (APBI) is currently still gathering information regarding the progress of the RKAB revision, as not all members who submitted the RKAB process have been approved, Executive Director Gita Mahyarani was cited as said.

The Indonesian Nickel Miners Association (APNI) also called for a fair implementation of the revised RKAB, saying production levels should remain aligned with reserves to support the sustainability of downstream industries.

Nickel mining companies that submitted their proposals by the July 31 deadline are now awaiting the results of their revised 2026 RKAB proposals, according to Djoko Widajatno Soewanto, an adviser to APNI.

Industry observers said the delayed approval process could limit the actual impact of any production increases this year.

Ardhi Ishak Kosen, head of industrial relations and associations at the Indonesian Mining Experts Association (Perhapi), said mining companies would have limited time to execute additional production plans if approvals were issued in August.

"There are only four months left, plus the rainy season," Ardhi said, referring to the remaining September-December production period.

Bisman Bakhtiar, executive director of the Center for Energy and Mining Law Studies (Pushep), urged the government to provide greater certainty on the approval timeline and evaluation criteria, saying delays could affect production planning, investment decisions and business contracts.

The revised RKAB approvals are expected to determine Indonesia's remaining coal and nickel production capacity for 2026, although analysts said the limited time available for implementation could constrain any significant increase in output.