Indonesian Government provided a sigh of relief for coal producers as HBA benchmark coal price continued to rise.
HBA (Harga Batubara Acuan) is the benchmark price of Indonesian thermal coal set by the country’s Ministry of Energy and Mineral resources. The Ministry has set the benchmark price at USD 83.81/MT for May’17.
Benchmark price has risen by 1.6% M-o-M compared with USD 82.51/MT set for Apr’17. On the yearly basis, HBA price has surged by 67.3% compared with the price of USD 51.2/MT set during May’16.
The significance of HBA Benchmark:
HBA benchmark price is a monthly average price based 25% on the Platts Kalimantan 5,900 kcal/kg GAR assessment, 25% on the Argus-Indonesia Coal Index 1 (6,500 kcal/kg GAR), 25% on the Newcastle Export Index (6,322 kcal/kg GAR) and 25% on the globalCOAL Newcastle (6,000 kcal/kg NAR) index.
The Benchmark price for thermal coal is the basis for determining the prices of 75 Indonesian coal products and calculating the royalty producers have to pay for each metric tonne of coal they sell.
Whether this benchmark coal price will continue to rise in the coming months is largely dependent on China’s domestic coal policies.
Source: Indonesian Ministry of Energy and Mineral Resources
Prices in USD/MT
Indonesian Coal Prices:
Indonesian coal prices have been on the downtrend following lacklustre demand from both China and India.
High CV 5000 GAR was offered for USD 59/MT, FoB Kalimantan. 4200 GAR was assessed at USD 39/MT, FoB Kalimantan while Low CV 3800 GAR was assessed at USD 36-37/MT, FoB Kalimantan for May Loadings.
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