Indonesia plans to introduce a market-driven approach to its mining sector by adjusting coal and nickel production limits based on price fluctuations and industrial requirements.

The government previously reduced annual output targets to balance supply and stabilize resource values. However, Energy and Mineral Resources Minister Bahlil Lahadalia confirmed that the state will permit a measured relaxation of these limits if global commodity prices stay favorable.

For the nickel sector, revisions aim to prevent severe raw material deficits at domestic processing facilities. Local smelters expect high demand, which currently exceeds the government's initial approved mining plans.

Mining executives warned that rigid output caps risk slowing down refinery operations and disrupting supply chains, prompting the ministry to align future extraction volumes with actual factory consumption.