Indonesian thermal coal supplies have come under pressure as the integrated system for tracking shipment reports submitted by surveyors faces disruptions.
A number of surveyors — entities that survey coal cargoes for quality and quantity — have been logged out of the government's marketing verification module (MVP) system, affecting the issuance of survey reports known as Laporan Surveyor (LS) and verification reports called Laporan Hasil Verifikiasi (LHV). This has affected barging and vessel loading operations since 23 October as surveyors have been unable to issue the reports, market participants said.
The latest disruption follows a similar issue earlier this month and comes as surveyors did not comply with an advisory issued by the country's energy ministry (ESDM). The ministry on 9 October asked surveyors to carry out the technical verification of coal cargoes and finalise transactions within 10 days of the planned shipment dates by coal producers. The ESDM initially gave surveyors until 20 October to comply with the directions as in some cases data tracking back to 2019 were to be input in the system. But Indonesia's key surveyors did not comply with the directions on time, leading to the revocation of rights to access the system, market participants added.
The impact on coal volumes could not be immediately ascertained as the issue still persists, with discussions continuing between surveyors and the ESDM. One of the main surveyors may have regained the access to the government system, indicating that the issue might be resolved soon. Indonesia exported 335mn t of coal in January-August, up from 295mn t a year earlier. The shipments averaged 42mn t/month, and roughly 1.4mn t/a day.
The disruption has created confusion with respect to potential demurrages and penalties owing to the extended loading periods, another market participant said, adding that some buyers might seek replacement cargoes from origins including the Philippines.
The latest issue underscores the problem Indonesia is facing in modernising and integrating the processes involved in exports of coal. The country has integrated its systems for recording coal production, barging, survey and royalty payment among other steps as part of its move to streamline its processes. But the recent disruptions to the system have affected barging, loading of coal, and have weighed on overall availability of spot cargoes in the market. The pressure on supplies comes as several producers were still waiting for a government decision on their revised work plan (RKAB) for the year.
Indonesia recently launched an E-RKAB work plan system to facilitate revised RKAB approvals. But some participants were wary about the efficiency of the RKAB approval processes after experiencing significant hiccups in the production tracking and royalty payment systems.
Seaborne coal supplies from Indonesia have also faced issues from changes in weather conditions and accidents in recent months. Persistent dry weather in South Sumatra province has exacerbated dust pollution, disrupting coal supply in the region. A major Indonesian low-calorific value (CV) coal producer issued a force majeure last month, after a truck accident occurred on a coal-hauling road in east Kalimantan.
