India to be biggest buyer of Indonesian coal by 2011

India will pass Japan to be the biggest buyer of Indonesian coal by 2011, said Bob Kamandanu, chairman of the Indonesian Coal Mining Association.

Coal imports by India may rise to 70 million tonnes, up from 40 million tonnes this year, Kamandanu told reporters on the sidelines of Coaltrans Upgrading Coal Forum in Jakarta today. “In the past, India only bought high-quality coal, but now they started buying a lot of low-rank coal also because of an increase in domestic consumption,” Kamandanu said.

Low-rank coal is the fuel with energy value of as much as 5,000 kilocalories a kg.

Japan is still the biggest buyer of Indonesian coal this year with imports of about 60 million tonnes, he said. South Korea ranks third behind India, Kamandanu said.

Coal prices may rise to $100 a tonne by the end of this year because of bad weather, which has disrupted mining in Indonesia, and port bottlenecks in Australia, Kamandanu said.

“Demand is there and it’s normally high at the end of the year due to cold temperature and it will support prices,” he said. Indonesia may produce about 305 million tonnes of coal this year of which 240 million will be exported, Kamandanu said.