Indonesia's coal exports fell in September, affected by weaker supply and demand. According to the Badan Pusat Statistik (BPS) Indonesia, coal exports in the month totaled 45.55 million tonnes, down 5.19% year on year and 7.36% from August.

Despite the declines, September's exports were the second-highest of the year. The drop was attributed to several factors, including weak demand from major importers, weather disruptions in Indonesia, and increased market competition.

Heavy rains and floods in key coal-producing regions like East and South Kalimantan disrupted mining operations, slowed railway transport to ports, and delayed shipping schedules.

In addition, domestic exporters were reluctant to lower prices, which reduced price competitiveness. With Indonesian government setting a relatively high HBA prices, buyers increasingly turned to cheaper coal from Australia and Russia, putting further pressure on Indonesian coal exports.

September also marked a seasonal low in demand. In India, industrial activity slowed in monsoon season, dampening coal demand.

Japan and South Korea saw an increase in clean energy generation, curbing coal imports. Meanwhile, China's domestic coal production and renewable power generation rose, while increased rainfall boosted hydropower, further lowering demand for Indonesian coal.

The export value dropped 20.19% YoY to $2.51 billion, and fell 2.77% MoM, showed data from BPS. The average export price decreased 15.82% YoY but grew 4.95% MoM to $55.17/t during the period.

Over the first nine months, Indonesia exported 380 million tonnes of coal in total, down 7.3%, with export value falling 21.72% to $22.13 billion and the average price dropping 15.55% to $58.1/t.

By coal type, Indonesia exported 28.02 million tonnes of other coal (non-coking coal), down 2.32% YoY and 6.87% MoM, accounting for 61.52% of total exports. Exports of lignite coal were 11.45 million tonnes, a 12.54% YoY decrease and down 10.23% MoM, making up 25.13% of the total.

Exports of other bituminous coal amounted to 3.34 million tonnes, dropping 15.96% YoY and 23.55% MoM, contributing 7.33% to the total coal exports. Coking coal exports stood at 2.74 million tonnes, up 23.09% YoY and 53.67% MoM, representing 6.02% of total exports.

Exports of thermal coal (other coal, other bituminous coal, and lignite coal) totaled 42.81 million tonnes, falling 6.43% YoY and 9.32% MoM, a share of 94% against the total, while export value fell 22.08% YoY to $2.24 billion, down 6.23% MoM.

Indonesia's top five export destinations in September were China, India, the Philippines, Maylasia and South Korea, which together accounted for 79.7% of the total exports for the month. Four of top ten buyers in the month was southeastern countries.

China remained the largest buyer, receiving 19.16 million tonnes, down 8.56% YoY and 8.31% MoM, representing 42.07% of total exports against August's 42.51%. The export value to China was $918 million, sliding 17.2% YoY and 0.11% MoM.

Exports to India amounted to 8.93 million tonnes, up 3.76% YoY and 4.86% MoM, making up 19.6% of total exports, higher than 17.32% in August. The export value to India was $408 million, down 13.47% YoY but up 12.98% MoM.

Exports to the Philippines decreased 9.68% YoY and 16.66% MoM to 3.05 million tonnes, accounting for 6.69% of total exports. Shipments to Malaysia dropped 7.13% YoY but surged 21.36% MoM to 2.59 million tonnes, comprising 5.68% of the country's total exports. Exports to South Korea were 2.56 million tonnes, rising 4.08% YoY but down 31.35% MoM.

In September, exports to Southeast Asian nations totaled 9.4 million tonnes, descending 6.97% YoY but rising 0.44% MoM, representing 20.6% of Indonesia's overall exports. Indonesia's coal exports to Europe were 76,000 tonnes, up 2.99% YoY but 3.4% lower than the previous month.

The Indonesian government reduced the validity of mining production quotas (RKAB) from three years to one, raising concerns about potential operational uncertainties.

Despite continued weak demand, some large thermal coal producers plan to maintain or increase their production quotas, reflecting optimism about a potential market recovery.

Delays in shipments due to heavy rains in September are expected to affect coal deliveries in the coming months. As the Indian monsoon season ends and China's demand for home heating rises, Indonesian coal exports could see a short-term boost.