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Until recently China was the world’s largest exporter of coal. While it is still the largest producer, a new exporter has come on to the map. Indonesia recently surpassed China in the market for exporting coal. Many Chinese power stations are even importing coal from Indonesia rather than obtaining it from within its own borders.
Countries like Japan, South Korea, and India are all looking to Indonesia for their coal imports. Most Asian countries rely on coal as their major energy source, which benefits Indonesian coal exporters in particular because of its close location to many of these major importers.
Despite the entire buzz about cleaning up our environment, experts still predict the demand for coal will increase in the next five years. Since this energy source is cheap and very abundant, it looks like countries are not planning on sacrificing low prices for cleaner energy.
Indonesia currently exports over 80% of the coal it produces. To accommodate for future exports, new coal mines are being built. In the meantime, China is shutting down many of its smaller mines and looking to bring in more coal from other areas. This is where Indonesia has stepped in. Coal from Indonesia is also higher quality than coal produced in China. It is predicted that exports of coal to China will double in the next couple of years. This is good news for Indonesia.
Coal exports in Indonesia appear to have a bright future! However, considering the importance of keeping the environment clean, higher taxes could be tacked on to the importing and exporting of coal. This could place a stress on China to look within their own borders for energy sources first, rather than turning to Indonesia.
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