Insurance rule change brings coal delays in Indonesia

Insurance rule change brings coal delays in Indonesia

Bulkers are facing “significant” delays in moving coal shipments out of a number of ports in Indonesia, according to Alphabulk, on the back of newly enforced insurance laws in the archipelago. The latest weekly report from Alphabulk, part of France’s AXS Marine, states that a “raft of ships” are being help up as Jakarta has forced coal exporters to use local insurers. Port authorities are checking exporters and vessels to see if the right insurance is in place leading to the delays.

A second regulation due to come into force on May 1 2020 could have far wider implications, Alphabulk warned. In May next year Indonesian exporters will be forced to use Indonesian-controlled vessels. This is not the first time Jakarta has tried to nationalise raw material exports, something that has failed repeatedly in the past.

Alphabulk data shows Indonesia exports 30m to 35m tons of coal per month, but has a domestic fleet of around 4m tons per month. At the moment around 95% of all coal is shipped from Indonesia on foreign controlled ships.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.

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