he government is considering a policy that would require thermal coal exporters to sell the commodity using Indonesia’s coal reference price (HBA) to prevent Indonesian coal from being sold abroad at prices below the local benchmark.
Companies that fail to do so may have their export permits revoked, Energy and Mineral Resources Minister Bahlil Lahadalia told reporters in Jakarta on Monday.
“I am ordering the [coal and mineral resources] director general to properly calculate our HBA compared to the ICI [Indonesian Coal Index]. I announce today that, in the not-too-distant future, we will consider issuing a ministerial directive to use the HBA for transactions in the global market,” he said.
“If companies are unwilling to adhere to that [...] we will not issue them export permits.”
Prices offered by Indonesian exporters often take cues from the ICI, which tracks a range of Indonesian coal types. However, the ICI price is often below international coal indices, partly because a significant portion of Indonesia's coal has lower calorific value than coal assessed in international benchmarks, such as the ICE Newcastle.
Bahlil took issue with the fact that Indonesia does not determine global coal prices despite being the world’s largest exporter of thermal coal.
Southeast Asia’s largest economy shipped out about 555 million tonnes of coal last year, energy ministry data shows, which is roughly 35 percent of some 1.5 billion tonnes of coal sold on the global market, the minister noted.
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