Coal Exports to China Plunge Amid Slowing Demand and Rising Competition
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JAKARTA, Investortrust.id — Indonesia’s coal exports to China, its largest overseas market, have declined significantly in 2025, with experts pointing to shrinking industrial activity, increasing domestic output in key markets, and shifting demand toward higher-grade coal.
Singgih Widagdo, Chairman of the Indonesian Mining & Energy Forum (IMEF), said three main factors contributed to the sharp downturn.
First, China’s manufacturing slowdown has dampened coal consumption. The country’s Purchasing Managers’ Index (PMI) fell to 49.4 in May, entering contraction territory after reaching 50.4 in April. “As a result, coal demand from industrial users dropped, and coal stockpiles at several ports remained high,” Singgih told Investortrust on Friday.
Second, China and India have both increased their domestic coal output, further reducing their reliance on Indonesian coal imports. China’s monthly coal production now averages around 400 million tons, while India produces between 90 and 100 million tons per month. “This growth in local supply has significantly curbed Indonesia’s export volumes to both countries,” he said.
Third, China is shifting toward importing medium- and high-grade coal to optimize pricing and energy efficiency, leaving Indonesia — which largely exports lower-grade coal — at a disadvantage. “We’ve seen China increase coal imports from Russia and Australia by 62% and 6% respectively, while imports from Indonesia have declined 12%,” Singgih added.
Data from Statistics Indonesia (BPS) show that national coal export earnings reached $10.26 billion between January and May 2025, down 19.1% year-on-year from $12.68 billion in the same period last year.
In volume terms, Indonesia exported 156.37 million tons of coal during the first five months of 2025 — a 4.65% decrease compared to 163.99 million tons in the same period of 2024.