JAKARTA Oct 18 The current rally in thermal
coal prices could extend through to the end of the first quarter
of 2017, an Indonesian mining ministry official said on Tuesday,
helping cash-strapped miners boost revenues in Southeast Asia's
Coal prices sank 70 percent over 2011 and 2015 amid worries
imports by top consumer China had peaked on measures to combat
pollution. However, contrary to expectations of further falls,
prices have rallied by about 75 percent this year
with producers trimming supply due to concerns over demand.
Indonesia, where thousands of coal mines went out of
business as prices cratered, is now confident of achieving its
target of 30.11 trillion rupiah ($2.32 billion) in non-tax
revenue from the coal and minerals sector this year, Coal and
Minerals Director General Bambang Gatot told Reuters.
In 2015, the world's top thermal coal exporter had missed
its target by 43 percent.
"Right now we're almost at 50 percent. With the rise in coal
prices hopefully we'll reach it," Gatot told Reuters.
Given the mining sector accounts for around 4 percent of
Indonesia's GDP, any rise in revenue would be welcome news for
the government at a time when the country's fiscal deficit is
expected to widen to 2.7 percent of GDP from the 2.15 percent
In the first half of 2016, Indonesia's non-tax revenues from
mining reached 12.3 trillion rupiah, about 40 percent of the
full-year target, the finance ministry website shows.
Higher coal prices are "good for state revenues, and will
give breathing space to coal companies that were trying to keep
running to survive", Gatot said.
($1 = 12,983 rupiah)
(Reporting by Fergus Jensen, additional reporting by Gayatri
Suroyo; Editing by Himani Sarkar)