The government of Indonesia has set its thermal coal benchmark price (HBA) for May 2020 at USD 61.11 per metric ton (MT), lower than USD 65.77/MT in April, the second decline in two consecutive months.
The Ministry of Energy and Mineral Resources said in a statement Wednesday that the decline in the HBA is in line with lower international coal prices as the weakening global economy has reduced coal demand in major importing countries in Asia including China, India, South Korea, and Japan.
In addition, the drop in crude oil price has also undermined the price of coal in the international market as seen in the lower four international indices that form the HBA, namely Indonesia Coal Index (ICI), Newcastle Export Index (NEX), Globalcoal Newcastle Index (GCNC), and Platt’s 5900.
The HBA declined in January of this year to USD 65.93/MT from USD 66.30/MT in December, and then increased in February and March, and declined again in April to USD 65.77/MT from USD 67.08/MT in March.
The HBA for May will be used for direct sales (spot) for one month at the point of sale for Free on Board on a transport vessel (FOB Vessel).
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