India Threatened by Darkness, 6 Issuers Diligently Export Coal

Jakarta, CNBC Indonesia – The country with the second largest population in the world, India, is reportedly threatened with an electricity crisis. This is likely to happen in July-August 2022.

A report says a number of cities are now experiencing rotating blackouts. This is believed to be getting worse in the next few months.

As a result, coal imports from India are believed to continue to increase amid a surge in electricity demand. The use of electricity in Bollywood has skyrocketed since April due to the heat wave.

India must also increase its coal imports to prepare for the demand that is expected to surge during the rainy season in July-September.

The energy crisis and insufficient coal for domestic use occur even though India has exported millions of tons of coal from Indonesia.

According to Reuters, India’s coal imports are expected to reach 20.05 million in May this year. This level is the highest since last March.

This increase in imports will benefit a number of countries, especially Indonesia. India is expected to import 11.06 million tons of coal from Indonesia, an increase compared to April’s 8.13 million tons. Coal imports from Australia are estimated to reach 4.3 million tons, down from 4.94 million tons in April.

The following is a list of issuers who are diligent in exporting coal to India.

Earth Resources (EARTH)

This issuer belonging to the Bakrie Group is known to be the main exporter of coal to India, although the latest data for 2021 is not yet available, because the company’s annual report has not yet been published, in 2020 it was known that the number of coal exports to India by BUMI reached 17.31 million tons, slightly down from 2019 of 18.19 million tons

Adaro Energy (ADRO)

The issuer owned by Garibaldi ‘Boy’ Thohir is known to sell 51.58 million tons of coal in 2021, down 5% from the previous year. Apart from being sold domestically, Adaro’s coal is also exported to major markets including Southeast Asia, East Asia, China and India.

Adaro’s coal sales to India last year reached 11 percent of the total, equivalent to 5.67 million tons of coal.

Bayan Resources (BYAN)

The tycoon-owned issuer Low Tuck Kwong had a brilliant performance last year. Last year, the company produced 37.6 million tons, while its sales figure stood at 40.4 million tons.

The company’s annual report says that 12% of it is sold domestically, with the remaining 88% sold on global markets. India is said to control 10.10% or the equivalent of 3.91 million tons of coal.

Indika Energy (INDY)

The issuer that operates the Kideco Jaya Agung coal mine is still a major player in domestic coal, even though it has expressed its ambition to reduce coal revenues to below 50 percent by 2025.

Last year, Kideco’s mine production increased 8.5 percent to 35.8 million tons, while sales volume also increased. Kideco’s coal sales to the Chinese market reached 2.7 million tons, equivalent to 7.6 percent of total sales. However, this figure is down from 2020 which reached 3 million tons.

Bukit Asam (PTBA)

The issuer of this state-owned coal mine was 28.37 million tons of coal last year. Although more than half of it is absorbed by the domestic market, India is also a major export market.

PTBA’s coal exports to India last year decreased from all of them reaching 13% or the largest after domestic sales, to now being 3% or equivalent to 0.85 million tons of coal.

Indo Tambangraya Megah (ITMG)

ITMG is known to have sold 20.1 million tons of new coal last year, with domestic sales reaching 24 percent or 4.7 million tons. Although export sales were quite significant, it turned out that India was not the main export market for ITMG in 2021. Sales to India are still inferior to China, Japan, the Philippines, Bangladesh and Thailand.

ITMG’s coal sales to India last year only amounted to 3%, equivalent to 0.6 million tons. This figure decreased from the previous year which reached 0.9 million tons or equivalent to 4% of total sales.

CNBC INDONESIA RESEARCH TEAM

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