Indonesia HBA Benchmark Coal Price Up 12% Y-o-Y in Nov’17

Indonesian Energy and Mineral Resources has set benchmark thermal coal prices( also known as Harga Batubara Acuan, HBA) at USD 94.80/MT for Nov’17.

The HBA price which is calculated on the basis of 4 international coal indices, was up 12% Y-o-Y compared with USD 84.89/MT in Nov’16. The benchmark price forms the basis for determining prices of 77 Indonesian coal products and calculating the royalties that coal producers need to pay for each metric ton of coal sold.

Indonesian coal export is expected to increase to 370 MnT in CY17, up slightly from 365 MnT in CY16. The world’s largest coal exporter may also witness a 16% Y-o-Y growth in domestic coal consumption to 109 MnT in CY17, due to rising demand from domestic power stations.

Indonesian Coal Offers:
Limited buying activity from both Chinese and Indian buyers had continued to pull Indonesian coal prices down, as they wait for prices to stabilize.

China had maintained healthy coal stock at power plants, which have reduced their appetite for coal imports. Also, the power usage was low due to the reduction in industrial activities imposed by the Chinese government in order to curb pollution.

Decline in Indonesian coal price is expected till Nov’17, after which prices may uptick once China begins coal restocking for winter.

At present, Indonesian 5000 GAR coal was assessed at USD 64-65/MT, FoB Kalimantan. 4200 GAR coal price was heard at USD 44-45/MT, FOB Kalimantan.

Indonesian coal offers were supported by Indian demand, in a period when coal stock at the power plants was declining. However, after continual increment in domestic coal production and supplies to power plants, buyers may delay their buying waiting for further correction in coal prices.

Moreover, imported non-coking coal stock has reached a sufficient level of 11.23 MnT at Indian ports during week 46 (12-16 Nov), increasing 0.88% W-o-W, according to the data maintained by CoalMint Research, which would also tempt buyers to limit their imports.

Offer for Indian Buyers was assessed at USD 73-74/MT, CFR India for 5000 GAR coal. 4200 GAR coal was assessed at USD 53-54/MT, CFR India.