Trade Surplus Shrinks to $7.25B as Soaring Industrial Inputs and Energy Deficits Outpace Export Gains

JAKARTA, Investortrust.id — Indonesia recorded a cumulative trade surplus of $7.25 billion across the first eight months of 2026, marking a steep compression from the $29.35 billion windfall logged during the identical span last year, according to official data released by Statistics Indonesia (BPS) on Thursday, Oct. 1, 2026.

The sharp narrowing of the net trade balance reflects an aggressive rebound in inbound shipments that decisively outpaced outbound export growth. Total exports from January to August 2026 expanded 4.74% year-on-year to $193.64 billion from $184.89 billion, anchored primarily by non-oil and gas merchandise, which climbed 5.48% to $185.63 billion. However, total imports accelerated far more aggressively, surging 19.84% to $186.39 billion compared to $155.54 billion over the prior-year period.

The erosion of the merchandise trade surplus cuts to the heart of Indonesia's external balance sheet, which has historically served as a critical macroeconomic cushion for the rupiah and sovereign foreign exchange reserves. While expanding imports of factory inputs and machinery point to resilient underlying domestic manufacturing and capital expenditure, persistent oil deficits expose the archipelago to heavy dollar outflows, testing external stability amid heightened global currency turbulence.

Manufacturing and Nickel Anchor Outbound Cargo

Outbound momentum remained firmly tethered to domestic downstream processing, with manufacturing exports rising 7.87% to $159.55 billion to generate 82.40% of all national export earnings. Processed nickel and derived goods posted the strongest nominal expansion, climbing 50.12% or $2.87 billion to $8.59 billion. Shipments of mineral fuels rose 10.91% to $22.68 billion, while animal and vegetable fats and oils advanced 9.19% to $25.14 billion. In contrast, outbound shipments of precious metals and jewelry tumbled 42.82% to $4.23 billion, while agriculture, forestry, and fishery exports fell 18.45% to $3.69 billion amid lower coffee shipments.

By contrast, the oil and gas sector remained a profound structural drag on trade performance. Oil and gas exports dropped 9.98% to $8.01 billion, weighed down by an acute 68.92% collapse in crude oil shipments to $324.9 million and an 11.58% contraction in natural gas earnings to $4.28 billion. On the import side, energy purchases jumped 39.03% to $29.30 billion, driven by a 41.05% spike in refined petroleum products to $21.34 billion and a 33.89% increase in crude petroleum imports to $7.96 billion. The divergent trajectory deepened the cumulative oil and gas trade deficit to $21.29 billion, significantly eroding the $28.54 billion surplus generated by non-oil transactions.

Industrial Expansion Drives Inbound Shipments

The acceleration in total imports was overwhelmingly steered by the production needs of domestic manufacturers. Inbound flows of raw materials and intermediate goods jumped 20.67% to $133.38 billion, representing 71.56% of total national imports. Inward purchases of capital goods climbed 18.82% to $36.75 billion, accounting for 19.71% of inbound trade, while consumer goods purchases expanded 15.48% to $16.27 billion. Among specific non-oil commodity lines, electrical machinery and equipment imports recorded the largest increase, jumping 22.94% to $24.53 billion, followed by mechanical machinery and appliances, which climbed 15.26% to $26.79 billion.

China solidified its standing as Indonesia’s dominant bilateral trading partner across both directions of commerce. Non-oil shipments to China reached $47.44 billion, representing 25.55% of total non-oil exports, followed by the United States at $22.41 billion and India at $12.77 billion. Concurrently, China supplied 42.42% of Indonesia's non-oil imports, totaling $66.64 billion, ahead of Japan at $8.88 billion and Australia at $7.31 billion. Regionally, the Association of Southeast Asian Nations (ASEAN) absorbed $36.44 billion in Indonesian non-oil exports while delivering $22.91 billion in return cargo.

August Turnaround Provides Monthly Lift

On a single-month basis, August 2026 provided positive momentum as the monthly trade surplus rebounded to $3.55 billion, expanding from $121.9 million in July. Monthly exports reached $26.61 billion, up 6.72% year-on-year and 1.51% month-on-month, lifted by non-oil deliveries worth $25.62 billion. August imports touched $23.06 billion, expanding 19.09% year-on-year despite retreating 11.63% from July's intake. The August surplus was underpinned by a $6.09 billion non-oil surplus that comfortably offset a $2.54 billion energy shortfall.

At the provincial level, West Java remained the country’s manufacturing export engine from January to August 2026, contributing $27.35 billion or 14.13% of all national outbound cargo. Central Sulawesi followed with $17.20 billion, representing 8.88% of the total on the back of intensive mineral smelting, while East Java generated $16.62 billion or 8.58%, bringing the combined contribution of the top three producing provinces to nearly a third of the nation's total exports.