CONCERNS over major disruptions to coal trade and shipping arising from an abrupt ban by the Indonesian government on exports are being alleviated.

A select group of 25 coal producers in Indonesia are said to have been allowed to resume their exports.

Sources in the shipping industry told Lloyd’s List that Jakarta has lifted the restrictions for these companies, which contribute the majority of the country’s coal exports and have fulfilled their domestic supply obligations.

Indonesia, the world’s largest exporter of thermal coal, has a so-called Domestic Market Obligation policy, whereby miners must supply 25% of annual coal production to power facilities under the state utility company Perusahaan Listrik Negara for up to $70 per tonne, far below current market price.

A roster of the selected companies being circulated within the industry include Indonesia’s largest coal miners, such as Adaro Energy and Berau Coal.

Ships with their cargo on board have started to leave the ports today, having obtained bills of lading, sources said.

The vessels have been waiting outside ports after coal was loaded onto them in the past few days even with the government ban still in place, they added.

The energy ministry and the Indonesian Coal Mining Association did not immediately respond to the requests for comment.

One Singapore-based chartering source said no major disruptions to vessel schedules are expected.

“Charters and operators may incur only minor delays of just one to two days, which should have been already factored into the chartering contracts,” the person said, adding that exports of the smaller miners remain stranded.

A government source said the key to whether or not the export ban will be lifted completely lies in state power producer Perusahaan Listrik Negara getting adequate coal supply.

“If PKN gets enough coal to meet its needs, the ban will be lifted completely,” he said, without elaborating.

Ridwan Jamaludin, director-general of minerals and coal at the energy ministry, said earlier this month that the “temporary” ban was aimed at replenishing stockpiles for about 20 coal-fired power plants for state power utility company Perusahaan Listrik Negara to avoid a “nationwide blackout”.

A shipbroking source in Singapore said “exorbitant” coal prices in the local market appeared to have prompted Indonesian authorities to resort to the unexpected and knee-jerk total ban on exports to force local producers to temper prices at which they sell coal to the country’s power producers and ensure adequate supply to the latter.

With domestic coal price capped at $70 per tonne against export prices of more than double and up to $200 per tonne, some producers have opted to defer supply to local customers in favour of increased export shipments, a source among coal producers told Lloyd’s List.

In a related development, Indonesia’s President Joko Widodo said today that the government has revoked more than 2,000 mining, plantation and forest-use permits. It is unclear yet the extent of involvement of local coal miners, whose production and export capacity could be affected.