Indonesian coal prices seen firm as demand has remained robust while loading disruptions in an anchorage in East Kalimantan in the past two weeks have contributed to tight supplies, traders said.
Indonesian coal with a heating value of 4200 GAR was quoted around USD 45-46.50/MT, steadily rising from USD 43-44/MT level early this month.
“Demand currently come mostly from India as domestic coal production in India is not ramping up as expected. So it has to be met through Indonesian coal imports,” said an Indian trader in Mumbai.
The Indian trader added that there are some buyers who are willing to pay up USD 47/MT for 4200 GAR due to tight supply.
Another trader based in Surabaya, in East Java said his company has received inquiries for Indonesia coal from Southeast Asian and other Asian countries, such as Thailand, Vietnam and Taiwan.
While demand is seen recovering, supply has been tight, meaning few cargoes on the market. According to the Indian trader, there are few cargoes of 4200 GAR available on the spot market with most miners have sold out until July, he said.
A blockade at an anchorage where vessels load coal to bigger vessels had disrupted loading and unloading activities in East Kalimantan in the past two weeks, have further squeezed supplies, traders said.
Some local fishermen had blocked Muara Berau port in Kutai Negara Regency in East Kalimantan on May 13, hampering ship-to-ship coal transfer. The fishermen has claimed that the coal loading and unloading activities damage the surrounding environment.
There had been 28 vessels which were unable to load coal when the blockade started at the port which has a loading capacity of 2 MnT per week.
Information whether the blockage has ended and loading activities have resumed were unclear.
A Jakarta based trader said at least 20 vessels were still unable to load coal on Monday, May 28, 2018.
“The blockage has squeezed the already tight supply because sellers have to scramble to make a new shipment schedule,” said the Jakarta trader.
But HendraSinadia, executive director of the Indonesian Coal Mining Association (APBI) said that loading activities in Muara Berau have returned to normal after the fishermen and the port authority held a meeting on Monday afternoon.
“The blockade has been cleared. It only occurred from May 13-17. It has been resolved with Monday’s meeting. Loading resumes to normal,” Sinadia said through text messages.
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