China Plans to Buy Back Australian Coal, Shares of Indonesian Coal Companies Fall Today


BONSERNEWS.COM – At the beginning of 2023, the coal business world received some bad news from neighboring countries. The news that China will again buy coal from Australia has caused several shares of Indonesian coal companies to fall on the Indonesian stock exchange ahead of the weekend.

China is a big market for the Indonesian coal business. According to Reutersin November 2022 alone, China imported over 20 million tonnes of Indonesian coal.

In percentage terms, 60% of China’s coal imports come from Indonesia. This data shows that China has its own value for Indonesian coal.

Also Read: Conundrum of Coal Stocks in 2023

At the beginning of 2023, bad news hit the Indonesian coal world. China plans to revive cooperation in purchasing coal from Australia.

China itself had had an uneasy relationship with Australia in recent years. As a result, Chinese businessmen were prohibited from buying Australian coal.

Also Read: Finances are Improving, PT Pos Indonesia Targets to Conduct an IPO in 2025

This ban has been going on since last October 2020. In 2020, many Australian ships were stranded in China after the ban.

At that time, coal became 7 Australian products that China was prohibited from buying. After the ban policy earlier, China diverted coal purchases to Indonesia.

Since the middle of 2022, China has planned to ease its purchase of coal from Australia. This is getting closer to being realized in early 2023.

After discussing with The National Development and Reform Commission (NDRC), 4 Chinese coal importers open the possibility to re-import coal from Australia. The four importers are China Baowu Steel Group Corp., China Datang Corp., China Huaneng Group Co., and China Energy Investment Corp.

If things go well, in 2023, China will again import coal from Australia. This news is expected to be the reason that several coal company shares in Indonesia fell today, Thursday (05/01/2022).

This can be seen in the shares of 5 companies engaged in the energy sector, especially coal. Quoted from CNBC, the five companies were;

  • PT Bukit Asam Tbk (PTBA) fell -4.34% year-to-date
  • PT Indo Tambangraya Majestic Tbk (ITMG) is down -6.73% year-to-date
  • PT Indika Energy Tbk (INDY) fell -9.16% year-to-date
  • PT Harum Energy Tbk (HRUM) fell -4.94% year-to-date
  • PT Bumi Resources Tbk (BUMI) fell -9.32% year-to-date

The news about the purchase of Australian coal by China added to the ‘burden’ of coal stocks in early 2023. Not to mention, the issue of the 2023 economic recession which still haunts the Indonesian business world.

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