The coal crisis in China is increasing. China is now taking Indonesia's help to deal with the power crisis. Indonesia supplied a record number of coal supplies to China last month. According to reports, Indonesia exported more than 21 million tonnes of coking, thermal and brown coal to China in September. It was just 17 million tonnes in September. At present, Indonesia is importing about two-thirds of China's total coal imports.
China's dependence on coal has increased on Indonesia since the deteriorating relations with Australia and the coronavirus pandemic. But China is hoping that Mongolia can supply even more coal.
The cost of poor quality coal from Indonesia is also getting expensive. This is happening because of the increase in demand since June. China is also continuously buying coal from Indonesia to overcome the power crisis. Reports suggest that Indonesia exports a variety of low-grade coal Which are available cheap but they are less effective. Plus it's even worse for the climate.
At the end of last year, China struck a $1.5 billion deal with Indonesian mineral companies as relations between Beijing and Canberra soured. In such a situation, China has considered Indonesia as its long-term option.
Reports suggest that Indonesia will continue to export more to China for now as there is less demand from India, another of its major markets. However, China may still face problems as the Indonesian government has asked to prioritize domestic supplies as mining activities have been disrupted in recent days due to floods and epidemics.
