ITMG Coal Shipments Hit by Mahakam River Low Water

ITMG Chief Executive Mulianto said several of the company’s mines in the Melak area are facing lower river levels, forcing the miner to load barges below normal capacity to reduce the risk of grounding. The company said transport costs are running about 30% to 40% above normal, with shipment volumes from affected mines also likely to drop by 30% to 40% depending on water levels.

The market impact is broader than a single miner. Indonesian thermal coal exporters rely heavily on river transport, so low water can hit deliveries, raise per-tonne freight costs and delay cargoes just as buyers in Asia are already dealing with volatile energy markets. That puts pressure on miners with heavy upstream exposure and gives an edge to producers with better access to alternative logistics routes.

Coal equities have already been trading with plenty of volatility, and the latest river constraints add another operational risk into the mix. Peers with similar inland transport exposure could face margin compression if the dry spell persists, while traders and utilities may see tighter near-term supply from Kalimantan.

The key catalyst now is rainfall and river depth in the coming weeks. If the Mahakam stays shallow, transport bottlenecks could linger into the next loading cycle and keep freight costs elevated through the peak dry season.