Indonesian coal prices have been thriving this year, average benchmark price( also known as Harga Hatubara Acuan or HBA) in CY17 (upto Oct’17) has increased to USD 84.2/MT, in comparison with the average HBA price of USD 61.8/MT in CY16. Moreover, HBA price was set at USD 93.99/MT for Oct’17, which was the highest since Dec’16.
Despite the high coal prices, actual production has remained relatively low during the year primarily due to the bad weather conditions that have affected production process.
According to the data provided by country’s Ministry of Energy and Mineral Resources, total coal production in CY17 (upto Aug’17) has reached 294.5 MnT, which is only 62% of the planned production target of 477 MnT for CY17.
Energy Ministry has initially revised its yearly production target from 413 MnT to 477 MnT to gain from the rising coal demand. However, in the period of low coal supply, Indonesian miners have been often engaged in completing previous month’s backlog shipments, thereby keeping their offers firm.
With the production not likely to be achieved in CY17, Energy Ministry is considering to revise the current production target.
Indonesian Coal Offers:
Chinese buyers have returned to the market , after a week’s absence due to the national holidays. Also, Indian power utilities facing critical coal stock levels are active in the coal market, which has kept Indonesian coal offers firm this week.
Offer for 5000 GAR coal was assessed at USD 67-68/MT, FoB Kalimantan. While offers for 4200 GAR and 3800 GAR coal was heard at USD 47-48/MT and USD 38/MT, FOB Kalimatan.
Offers for Indian buyers translate into USD 77-78/MT CFR India for 5000 GAR coal. 4200 GAR coal price was USD 56-57/MT, CFR India.
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