NUSADUA, Indonesia, Sept 10 (Askume) – Coal trade and consumption in Southeast Asian countries such as Vietnam and the Philippines are expected to grow this decade, with demand peaking in top consumer China, industry executives said.
In a speech at the Coaltrans Asia conference, President Priyaditya said the Indonesian Coal Miners Association (ICMA) expects imports from China and India to peak in 2025, halting growth in global seaborne trade in the polluting fuel.
However, ICMA expects annual coal imports by Southeast Asian countries, including Vietnam and the Philippines, to rise by an average of 3% from 140.9 million tonnes in 2023 to 170.9 million tonnes in 2030.
Vietnam is the fastest-growing economy in Southeast Asia, and its power generation is considered the most promising growth market for coal, traders and industry executives who attended the meeting said.
Dinh Quang Trung, deputy general manager of coal trading at state-owned Vinacomin, said he expects Vietnam to export 66 million tonnes of coal by the end of this year. Production will reach 47.8 million tonnes in 2023, according to analyst firm Kpler.
“By 2035, our coal imports will reach 86 million tonnes per year. About 70-75% of our total consumption will be for power,” he said.
Kpler data showed Philippine coal imports rose 7.6% in the eight months to Aug. 31, while Malaysian coal imports rose 4%.
Although Southeast Asian countries are expected to replace China and India as the main growth market for exporters, industry officials still expect consumption in major economies to remain high. Imports are expected to grow in the near term and remain broadly stable for the rest of the decade.
China’s thermal coal imports are expected to rise 6.3% year-on-year to 391 million tonnes in 2024, said Feng Dongbin, deputy general manager of Fenwei Digital Information Technology Co., which operates China’s coal analysis platform SXCoal.
Riya Vyas, a senior analyst at Indian coal trading company I-Energy Natural Resources, said she expects coal imports to grow this decade. As of the end of August, India’s import volume rose 11% year-on-year, according to data from Indian consulting firm BigMint.
Although the Southeast Asian country is not adding new coal-fired power generation to the grid, it is accelerating the use of existing power plants to meet growing electricity demand, industry officials say.
Data centres are becoming a key driver of growth in coal-fired power use in Malaysia, two senior executives at state-run Tenaga Nasional Fuel Services Bhd said. Data from energy think tank Ember shows Malaysia’s reliance on coal for power generation has risen while natural gas consumption has fallen.
Along with the Philippines, Indonesia is the most significant contributor to the growing use of the fuel in the region.
Patricia Lumbangol, senior market research manager at Adaro International, said: “The average age group for installation capacity in Indonesia is relatively young, so this suggests that long-term demand will remain strong.”
Indonesia’s nickel smelters, which supply battery makers and help meet demand for electric vehicles, are boosting coal-fired power generation, ICMA’s Priyadi told Askume.
Malaysia, the Philippines and Indonesia have the lowest renewable energy penetration rates in Asia outside the Middle East, lagging far behind major green energy producers such as China and India.
Efforts to reduce emissions in the world’s seventh-largest coal-fired power producer are being hampered by a lack of progress on plans by rich nations to provide cheap financing to quickly shut down coal-fired power plants.
Arthur Simatupang, president of the Indonesian Independent Power Producers Association, said: “The government’s focus on energy security and affordability has led to the continued use of coal, especially since it helps keep electricity prices relatively low.”
