Indonesia: HBA thermal coal benchmark prices show diverging trends for 1st half of Sep’26

• High-CV rises on tighter supply, lower-CV grades fall
• HBA-III sees first correction since first half of Feb’26

Indonesia’s Harga Batubara Acuan (HBA) thermal coal benchmarks for the first half of September 2026 showed mixed trends, with high-CV coal strengthening moderately while mid- and lower-CV benchmarks corrected. The divergence reflects differences in end-user demand, regional coal availability and buying interest across calorific bands. Indonesia’s HBA remains an important reference for domestic coal pricing and export-market price discovery.

High-CV firms on limited spot availability

The 6,322 kcal/kg GAR HBA increased 2.3% to $126.87/t, from $124.06/t in the second half of August. The increase indicates relatively firmer sentiment in the high-CV segment, supported by limited spot availability, higher procurement costs and selective demand for higher-quality coal. However, subdued buying interest in premium thermal coal, particularly amid competitive pricing from alternative origins, is likely to cap further upside.

Mid-CV coal softens as buyers remain price-sensitive

The 5,300 kcal/kg GAR HBA-I declined 2% to $95.05/t, signalling comparatively weaker demand in the mid-CV segment. The correction is consistent with price-sensitive procurement, adequate regional availability and competition from lower-priced coal alternatives. Buyers in major importing markets such as India are likely to remain focused on delivered economics, limiting their willingness to chase higher benchmark-linked offers.

Lower-CV benchmarks correct after sustained strength

Lower-CV coal benchmarks also eased, with the 4,100 kcal/kg GAR HBA-II declining nearly 1% to $65.05/t, while the 3,400 kcal/kg GAR HBA-III fell 3% to $44.15/t. Although both benchmarks corrected, prices remain supported by the relatively strong levels seen earlier in 2026. The decline in HBA-III marks its first correction since the first half of February 2026, indicating that the prolonged upward momentum in the lower-CV segment is beginning to moderate.

Market remains driven by supply discipline and regional demand

The broader Indonesian coal market continues to be shaped by production discipline, government supply-management measures, domestic market obligations, export availability and demand from China and India. Indonesia has also been seeking to manage coal output amid concerns over excess supply and weak pricing, making production and export-policy developments important indicators for benchmark direction.

Outlook

The near-term outlook remains mixed, with high-CV Indonesian coal likely to retain stronger support amid limited availability and replacement demand, while subdued Chinese buying and alternative-origin competition may cap upside. Mid- and lower-CV grades could face further consolidation amid comfortable inventories and cost-sensitive buying. Overall, prices are expected to remain range-bound with a grade-specific bias, while a strong El Nino-induced dry spell is disrupting Kalimantan barge logistics and tightening supply.