Indonesia: Mid-August HBA reflects weakening coal prices amid global demand shifts

• Lower grades record steeper declines
• Higher exports in Jul’25 weigh on prices

The Indonesian Ministry of Energy and Mineral Resources (ESDM) has released the updated Harga Batubara Acuan (HBA), the domestic benchmark price index for thermal coal, for the second half of August 2025. The newly announced figures reveal a weakening trend in price trajectories across all coal grades, shaped by ongoing changes in international market dynamics, including shifts in demand in key importing countries.

High-CV coal sees modest decline

The benchmark price for high-calorific value (high-CV) coal (6,322 kcal/kg GAR) fell by 1.5%, settling at $100.69/t compared to the first half of August.

The decline was driven by sluggish international demand, especially from major markets such as India, where utilities are adjusting procurement strategies amid high inventories.

Mid-CV coal slips slightly

Mid-calorific value (mid-CV) coal (5,300 kcal/kg GAR) under the HBA-I index posted a slight 0.2% decline to $67.2/t compared to the first half of August. This marks a slight declining trend, indicating a weakening demand profile, particularly from buyers in Southeast Asia and the Indian subcontinent.

The fall indicates a weakening preference for mid-CV coal amid ongoing global economic uncertainties.

Low-CV coal under pressure

Price movements in the lower calorific value (low-CV) segments experienced sharper corrections amid unpredictable market behaviour. As compared to the first half of this month, the HBA-II price of 4,100 kcal/kg GAR coal declined by 4.5% to $43.7/t, as demand softened from certain regional buyers.

Additionally, the HBA-III benchmark for 3,400 kcal/kg GAR coal, representing Indonesia’s lowest export grade, declined compared to the first half of August by 4% to $33.48/t. This decrease reflects weakening demand from domestic and regional utilities.

Stronger exports weigh on prices

Indonesia’s non-coking coal exports recorded an increase of 22% m-o-m in July, though shipments to India declined. The rise in outbound volumes to other destinations has injected additional supply into the global market, intensifying downward pressure on prices.

Outlook

Indonesia’s HBA prices for mid-August show a slight decline, signalling softer market fundamentals. This may dampen exporter confidence and pressure FOB prices. Sentiment remains cautious, with traders watching demand recovery trends in Asia to gauge whether prices will stabilise or continue downward.