Indonesian Coffee, Coal Production May Drop on Prolonged Rains

By Naila Firdausi

April 17 (Bloomberg) -- Western parts of Indonesia may experience a prolonged wet season in the second quarter of this year, potentially reducing coffee yields and cutting coal production, the weather office said.

Most parts of Sumatra, a coffee and coal-producing region, and Kalimantan, the biggest coal supplier along with Sumatra, have recorded higher first-quarter rainfall than last year.

“Sumatra will likely continue to be wet” this quarter, with a shorter than usual dry season later this year, said Soetamto, head of climatology and air-quality analysis at Indonesia’s Meteorology and Geophysics Agency.

Higher rainfall this year has already resulted in lower coal and coffee production in Indonesia, the world’s largest exporter of thermal coal and Asia’s second-biggest coffee grower.

First-quarter production at PT Berau Coal in East Kalimantan was 3 million metric tons, 90 percent of the target, partly because of rains, said Berau’s President Director Bob Kamandanu. “In the second quarter, we’ll likely only mine 3.3 million tons of the 4.3 million-ton target,” he said in a phone interview in Jakarta. “We’ll boost output in the second half to meet our target of 14.7 million tons for this year.”

Last month, Association of Indonesian Coffee Exporters Chairman Hassan Widjaja cut the country’s estimated coffee output by 20 percent to 320,000 metric tons after rains affected crops in Sumatra.

El Nino Phenomenon

While western Indonesia receives heavier rains, precipitation in eastern provinces, including the biggest rice producer Java, has been the same as last year, the office said.

“We see weak indications of an El Nino forming in August, which may affect Papua and Maluku,” Soetamto said. “In the equatorial Pacific there is a weak warming trend, which could suggest El Nino. We’re monitoring this indication to see if it’s getting stronger.”

The El Nino weather pattern typically results in droughts in Indonesia. If it strengthens and affects wider areas of the country, it may delay the beginning of the rice-planting season, the staple crop for Indonesia’s 243 million people.

To contact the reporters on this story: Naila Firdausi in Jakarta at nfirdausi@bloomberg.net