The scheduled introduction of bench-mark prices referred
as HBA Index by Indonesia beginning September 23, may not impact bulk of the
users of Indonesian coal in India.
According to international traders, through spot buying,
coal prices in Indonesia are either at par or higher than the indexed price
and, are unlikely to be impacted.
“We are currently
buying Indonesian coal of 5000 GCV (gross at receipt) at $80 a tonne. HBA Index
pegs the value of such coal at approximately $77 a tonne,” a source said.
“There benchmark price will have little or no impact on
landed price of majority of the coal imported in India as majority of the
Indonesian miners are already selling their produce at a higher price,” said Mr
Abhay Chaturvedi, Vice-President (Procurement) of Nagpur based Gupta Coal
(India) Ltd,.
However, the Indian users sourcing coal through long-term
off-take agreements at attractive prices much below the HBA Index, should be
impacted. India is expected to import anything between 70-100 million tonne of
Indonesian coal this fiscal. Unofficial estimates suggest that 60 per cent of
that is procured through spot or short-term contracts.
The prices are, however, expected to move northwards in the
longer run, especially after November, riding on an anticipated winter demand
from China.
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