Video: Quota Cuts Disrupt Production Targets — Layoffs Unavoidable

Jakarta, CNBC Indonesia – CNBC Indonesia hosted Mining Forum 2026 under the theme ‘What is the State of Indonesia’s Mining Industry?’, presenting strategic dialogue that brought together regulators, policy-makers, industry leaders and stakeholders. Ezra Sibarani, Deputy Chairman for Legal and Tax, Indonesia Mining Association (IMA), in Mining Forum 2026 highlighted several developments in the domestic mining sector. One key focus for miners is the reduction in production targets for mineral commodities in the 2026 Work Plan and Budget (RKAB).

RKAB 2026 sets coal production at a target of 600 million tonnes, down from 790 million tonnes in 2025; nickel production is targeted at 260-270 million tonnes, substantially below 379 million tonnes in 2025. The coal reduction has shocked miners due to the substantial decline, with the criteria for setting the cut not disclosed. Meanwhile, miners have already prepared investments to maximise production and fulfil customer commitments, so the RKAB 2026 is expected to disrupt targets and could lead to losses.

IMA Chairman Irwandy Arif noted that the mining sector faces several headwinds, including the RI-US and EU trade agreements related to critical minerals, Nickel Passport requirements, the price cycle, and sudden RKAB quota policies amid the US-Iran conflict. He argued that the mining sector faces short- to medium-term pressures and requires policies to bolster structural resilience and transparency, or else the sector could face a transitional crisis.

Similarly, the Executive Director of the Indonesia Coal Mining Association (APBI), Gita Mahyarani, said policy ambiguity around the RKAB 2026 has persisted for about a month, with miners lacking certainty on quotas and APBI members facing quota cuts of 40-80% without explanation or justification for the reductions.

Perhimpunan Ahli Pertambangan Indonesia (Perhapi) Chairman Sudirman Widhy stated that quota reductions in RKAB 2026 disrupt long-term mine planning, which is vital for production and the financial viability of mines and could precipitate layoffs.

The production uncertainty could also affect mining services firms, as ASPINDO reports that 85% of coal mining jobs are performed by ASPINDO. A 25% drop in coal production in 2026 could leave 25% of equipment and labour idle, and the uncertainty will also affect banking and multifinance financing, thereby impacting financial stability.

On RKAB 2026, the Secretariat of the Directorate General of Mineral and Coal (ESDM) Siti Sumilah Rita Susilawati, representing Director-General Tri Winarno, said RKAB 2026 is not a production cap but a production realignment/adjustment. The policy relates to three aims: the imbalance between supply and demand that depresses prices (notably nickel), price stability, and maintaining Indonesia’s mineral reserves.

Meanwhile, Herry Permana, Assistant Deputy for Mineral and Coal Development at the Ministry of Coordination for Economic Affairs (Kemenko Perekonomian), representing Deputy for Energy and Mineral Resources Coordination Elen Setiadi, stated that RKAB 2026 relates to energy security and downstreaming (hilirisasi) of Indonesia.

Bambang Patijaya, Chair of Commission XII of the Indonesian House of Representatives, described RKAB 2026 as a new policy with pros and cons; quota adjustments are not production restrictions for coal and nickel, but are intended to maintain the sustainability of Indonesia’s mining sector and should be supported.

APLSI Primary Energy Value Chain Committee chair Ferry Dwi Nugraha argued that the RKAB controversy disrupted coal supply to power plants at the start of 2026, causing reduced supply as miners delayed shipments amid quota uncertainty.

For more, watch the dialogue with Shafinaz Nachiar, Ezra Sibarani, Irwandy Arif, Gita Mahyarani, Sudirman Widhy, Ahmad Kharis, Siti Sumilah Rita Susilawati, Herry Permana, Bambang Patijaya and Ferry Dwi Nugraha at Mining Forum 2026, CNBC Indonesia (Friday, 06/03/2026).