| JAKARTA, Sept 4
JAKARTA, Sept 4 A new plan by China to put curbs
on shipments of low-quality coal is unlikely to happen quickly,
an industry group in top thermal coal exporter Indonesia said on
Thursday, with any impact likely to be offset by an uptick in
China, the world's top coal importer, is currently mulling
an industry proposal to halt imports of low-quality coal with
ash and sulphur content exceeding 15 percent and 0.6 percent,
Industry executives and traders said the plan will hit
Australia hardest among major coal exporters, while Indonesia,
which largely ships fuel with low heating value, won't be
Bob Kamandanu, chairman of the Indonesian Coal Mining
Association, told Reuters Indonesia's coal exports to China are
mostly low-quality and exceed the 15 percent ash content level.
Kamandanu was unable to give an estimate on how much the
Chinese plan might impact Indonesian coal exports or output but
questioned how quickly the rules would be implemented.
"It all depends when it will be applied. I have big doubts.
The Chinese massively need this kind of coal," he said.
Australia's coal exports overall are well within China's
proposed tolerances, the Minerals Council of Australia said, as
the average thermal coal ash content is between 10 and 12
percent and average sulphur content is between 0.2 and 0.5
The Indonesian association's chairman said if coal exports
to China are hampered, its neighbour could step in.
"There is an alternative - India will be needing a lot of
coal and predominantly, they are low quality."
In India, which is also a major buyer of Indonesian coal,
many of the country's thermal power stations have less than a
week's supply of coal on hand, according to data.
Indonesian coal exports are seen at around 350 million
tonnes this year and in 2015, according to the association, with
Chinese demand accounting for about 50 percent of the total.
Kamandanu said he sees a greater impact to Indonesian
production and exports from new export and royalty rules being
introduced by the Indonesia government.
But he said if global coal prices remained low then exports
and production must be curbed.
The price of Asian benchmark Newcastle coal has
dropped nearly 20 percent this year to five-year lows, hitting
$69.69 a tonne in the week to Aug. 29, due to heavy oversupply
from new mines built when Chinese demand growth began soaring.
Major coal producers who may be impacted by any changes to
Chinese import regulations include PT Bumi Resources Tbk
, Kideco and PT Berau Coal Energy Tbk, said
Bumi officials were unable to give immediate comment on
Thursday, while Berau and Kideco could not be immediately
(Additional reporting by Sonali Paul in MELBOURNE and Fransiska
Nangoy in JAKARTA; Editing by Muralikumar Anantharaman)