July HBA is Set at USD52.16 per Tonne

MINISTRY OF ENERGY AND MINERAL RESOURCES

REPUBLIC OF INDONESIA

PRESS RELEASE

NUMBER: 231.Pers/04/SJI/2020

Date: 3 July 2020

July HBA is Set at USD52.16 per Tonne

Indonesia's coal price benchmark (HBA) for July is set at USD52.16 per tonne. The price drops slightly by USD0.82 per tonne than price in June, which was set at USD52.98 per tonne. The drop has been caused by the same sentiment occurring last month, namely low absorption of Indonesia's coal supplies by the global market.

Head of Bureau of Communication, Public Information Services, and Cooperation of Ministry of EMR Agung Pribadi said the most significant factor is high coal stocks in India and China. "Both countries are prioritizing their domestic (coal) supplies," explained Agung in Jakarta on Friday (3/7).

Reduced demands for Indonesia's coal, continued Agung, cannot be separated from the strong impacts of the Covid-19 pandemic that have limited the economic moves of every country.

According to Agung, amid the pandemic, there is the tendency to shift to domestic energy alternatives. "The pandemic has inevitably shifted the energy consumption patterns to alternative sources," he emphasized.

Agung admits the HBA has been on a downward trend since the World Health Organization (WHO) declared Covid-19 a pandemic in the middle of March.

The HBA picked up by 0.28 percent to USD67.08 per tonne in March compared to the February price of USD66.89 per tonne. It then dropped to USD65.77 per tonne in April and USD61.11 per tonne in May. The current HBA is the lowest since 2016, when in February 2016 the HBA was set at USD50.92 per tonne.

The HBA refers to the average of four indices, namely Indonesia Coal Index (ICI), Newcastle Export Index (NEX), Globalcoal Newcastle Index (GCNC), and Platts 5900 of the previous month. The quality is equal to 6322 kcal per kilogram of GAR.

The HBA is used for direct (spot) sales of coal commodities for the whole month on the basis of Free on Board (FOB) the vessel. (IY)

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

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