Indonesian thermal coal benchmark price, HBA (Harga Batubura Acuan), has rebounded after falling for the past two months, to mark an increase of 7.9% M-o-M in Jun’18.
Indonesian Energy and Mineral Resource Ministry has set the benchmark price at USD 96.61/MT for Jun’18, up from USD 89.53/MT in the preceding month.
Although the benchmark price has erased most of the gains since touching the USD 100 mark in Feb’18 and Mar’18, yet the set price in Jun’18 was 28% higher on the year compared with USD 75.46/MT in Jun’17.
A spokesperson from Indonesian Energy and Mineral Resources Ministry had commented that the higher coal price had come on the back of Chinese coal production restriction as well as the impact of rising global crude oil prices.
Indonesian HBA coal prices is used as a basis for 6322 GAR coal price, which is then used to evaluate the price of 77 other coal products and the royalties coal producers have to pay.
The benchmark price is valid for exports and domestic end users except the Indonesian power producers. For the power stations, the thermal coal price has been capped at USD 70/MT (basis 6322 GAR) by the Indonesian government. However, if the HBA prices drops below the USD 70/MT, the domestic price for power stations will revert back to HBA.
Indonesian Coal Offers:
Indian coal buying from Indonesia is expected to slow down with the start of the monsoon season, as the country has recorded remarkable growth in imports in May’18.
An Indian trader has commented that many buyers had booked their coal vessels in advance to the monsoon, as the rainy season would eventually result in closure of ports. He had also anticipated the coal supply from Indonesian to improve post the Ramadan festival.
At present, Indonesian 4200 GAR coal was offered at USD 48-49/MT on FoB. While 5000 GAR coal was offered at USD 66-67/MT, FoB Kalimantan.
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