China Electricity Use Drops, March HBA Down to USD84.49/tonne

MINISTRY OF ENERGY AND MINERAL RESOURCES

PRESS RELEASE

NUMBER: 079.Pers/04/SJI/2021

Date: 2 March 2021

China Electricity Use Drops, March HBA Down to USD84.49/tonne

Indonesia's Coal Benchmark Price (HBA) declines by USD3.3 per tonne to USD84.49 per tonne for March 2021 trade. Low use of electricity in China has impacted coal demand by the country.

"After the end of Chinese New Year celebrations and towards the end of winter, the electricity consumption at business centers in China start to decline," said Head of Bureau of Communication, Public Information Services, and Cooperation of Ministry of Energy and Mineral Resources, Agung Pribadi, in Jakarta on Tuesday (2/3).

Agung said decreased electricity use was combined with the policy to lift domestic coal production by China and India, Indonesia's main export destination countries. "The governments of China and India have encouraged an increase in their domestic coal production to cope with the import relaxation policy," he added.

The decline in the HBA is the first in the last five months after the benchmark rose quite significantly. The HBA for October 2020 was set at USD51/tonne, November 2020 at USD55.71/tonne, December 2020 USD59.65/tonne, January USD75.84/tonne, and February USD97.79/tonne. "After a rally occurred for almost half a year, the HBA was corrected," said Agung.

Besides demand and supply factor, the HBA is calculated on the average of four coal market indexes in the world, namely Indonesia Coal Index (ICI), Newcastle Export Index (NEX), Globalcoal Newcastle Index (GCNC), and Platt's 5900 of the previous month.

The March HBA is used to determine coal sales price on the basis of Free on Board the vessel (FOB Vessel). (IY)

Head of Bureau of Communication, Public Information Services, and Cooperation

Agung Pribadi (08112213555)

Share This!