08-10-2016

Indonesia’s October HBA thermal coal price hits 2-year high

TC

Indonesia's Ministry of Energy and Mineral Resources has set its October thermal coal reference price, also known as Harga Batubara Acuan or HBA, at $69.07/mt FOB, up 8% from September and the highest level in two years. October HBA also represents a 20% jump from a year ago. The HBA was last set higher at $69.69/mt in September 2014.

The HBA price rally since May this year has been largely driven by a mix of supply cuts and strong demand from China.

The HBA is a monthly average price based 25% on the Platts Kalimantan 5,900 kcal/kg GAR assessment; 25% on the Argus-Indonesia Coal Index 1 (6,500 kcal/kg GAR); 25% on the Newcastle Export Index -- formerly the Barlow-Jonker index (6,322 kcal/kg GAR) of Energy Publishing -- and 25% on the globalCOAL Newcastle (6,000 kcal/kg NAR) index.

In September, the daily Platts FOB Kalimantan 5,900 kcal/kg GAR coal assessment averaged $62.14/mt, up from $57.19/mt in August, while the daily 90-day Platts Newcastle FOB price for coal with a calorific value of 6,300 kcal/kg GAR averaged $72.90/mt, up from $67.37/mt in the previous month.

The HBA price for thermal coal is the basis for determining the prices of 75 Indonesian coal products and for calculating the royalties producers have to pay for each metric ton of coal they sell locally or overseas.

It is based on 6,322 kcal/kg GAR coal, with 8% total moisture content, 15% ash as received and 0.8% sulfur as received.

Source: Platts 

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