Supramax and panamax earnings may be dented in the short term after Indonesia — a major source of seaborne coal — announced an export ban on the commodity on 1 January.
The government may reconsider the move as early as 5 January, Fearnleys said in a note to clients on Monday.
"While this is likely to be short-lived (and there are still plenty of uncertainties), our first take is that this should negatively impact supramax/panamax [rates] near-term," the brokerage said in its morning report.
Indonesia is the world's biggest exporter of thermal coal. Its clients include China, India, Japan and South Korea.
The government announced the ban on Saturday, with news agencies citing a senior official as saying the country could not meet its own power demand otherwise.
Without the ban, almost 20 power plants would have to shut, said Ridwan Jamaludin, director general of minerals & coal at the energy ministry, according to Reuters.
Indonesia exported about 400m tonnes of thermal coal in 2020, Fearnleys said.
If the ban persists, it will be hard to source these volumes elsewhere, due to the sheer amount and a global shortage of energy, according to the brokerage.
Working to revoke the ban
However, there may be an upside.
"While the current tightness in the smaller segments adds some leeway for owners, one month of lower global trade should alleviate some of the congestion and supply chain issues currently aiding the market," Fearnleys said, noting "very limited moves" on forward freight agreements for panamaxes and supramaxes in early trading on 3 January.
In commodities markets, however, prices for coal to India's west coast rose by as much as 500 rupees ($6.73) per tonne since the ban was announced, Reuters said, citing Riya Vyas, a business analyst at iEnergy Natural Resources.
But Vyas said she was unaware of any exporters declaring force majeure over the situation.
The Indonesian Coal Mining Association has urged the government to revoke the ban, calling it a hasty measure taken without consulting the industry, Reuters reported.
