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Jakarta Post

Indonesia coal price dips nearly 8% on dwindling demand

  • Stefanno Reinard Sulaiman

    The Jakarta Post

Jakarta   /   Wed, May 8, 2019   /   05:33 pm
Indonesia coal price dips nearly 8% on dwindling demand A bulk freighter transports coal on the Musi River in Palembang, South Sumatra. (Antara/Nova Wahyudi)

The Indonesian coal price reference (HBA) has continued to decline this month due to shrinking market demand to US$81.86 per ton, or a month-to-month (mtm) decrease of 7.86 percent.

Energy and Mineral Resources (ESDM) Ministry spokesperson Agung Pribadi said that East and West Asian countries, especially China and India, were currently limiting their Indonesian coal imports.

“China and India have started to reduce their coal imports from Indonesia. The countries launched a protection policy and have increased domestic coal production to fulfill [local] demands,” Agung said in a statement on Tuesday.

The Indonesian Coal Mining Association (APBI) estimated last year that Indonesia's annual coal exports to China was around 110 to 120 million tons for a market share of 25 percent, making China its biggest coal importer.

The energy ministry had observed a declining trend in Indonesia's coal price since October 2018, when coal was $100.89 per ton. It then fell to $97.90 per ton in November and $92.51 per ton in December.

The negative trend continued this year, dropping to $92.41 per ton in January, $91.8 per ton in February, $90.57 per ton in March and then to $88.85 per ton in April.

The government has targeted a national coal production similar to the actual output in 2018 of 485 million tons, of which 25 percent was for domestic market obligation (DMO). (bbn)