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Indonesian coal price hits decade high
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I
ndonesia has set its coal benchmark price at the highest in over a decade, supported by surging demand in China, South Korea and Europe, a statement published by the Energy and Mineral Resources Ministry showed on Monday.
The ministry set the benchmark coal price (HBA) at US$150.03 per ton in September, up 14.53 percent from the $130.99 per ton in August, and the highest since $116.65 per ton in November 2011, ministry data showed.
“The rising power demand in China is exceeding the capacity of its domestic coal production,” ministry spokesman Agung Pribadi said in the statement.
Read also: Behind the soaring coal price
He added that rising coal demand in South Korea and Europe was in line with rising natural gas prices in the regions.
European gas prices stood at 38.65 euros ($45.91) per megawatt hour on July 6, key European benchmark Dutch TTF hub data showed.
“[The high price] was caused [by] record low gas storage, outages, prolonged production issues and active Asian buying,” said Nick Campbell, director at consultancy Inspired Energy, on July 7 as reported by Reuters.
The HBA, which stood at $89.74 per ton in May, has been rallying since it fell to a record low of $49.42 per ton in September 2020, as economies reopen, increasing electricity demand. The HBA hit a nearly three-year high in June.
Read also: Indonesian coal price hits nearly three-year high
Indonesian Coal Mining Association (APBI) executive director Hendra Sinadia said the price hike was also due to limited supply amid the rainy season in Australia and Indonesia, the world’s top two coal exporters.
China’s coal importers were also facing difficulty importing Australian coal amid deteriorating political ties between the two countries.
“We hope that the price will continue to strengthen,” he told The Jakarta Post on Tuesday.
He added that the APBI was continuing to monitor climactic conditions, Australia-China relations and the United States Federal Reserve tapering in the coming months, all of which may affect global commodity prices.
