September HBA Set at USD150.03 per Tonne

MINISTRY OF ENERGY AND MINERAL RESOURCES

REPUBLIC OF INDONESIA

PRESS RELEASE

NUMBER: 313.Pers/04/SJI/2021

Date: 6 September 2021

September HBA Set at USD150.03 per Tonne

The growing coal demands in China due to a stronger demand by coal-fired power plants that has exceeded the country's domestic supply has lifted the Indonesian coal benchmark price (HBA) for September 2021 to USD150.03 per tonne. This is up by USD19.04 per tonne compared to the August HBA 130.99 per tonne.

"This is a quite phenomenal price in the last decade. The high demand in China which exceeds its domestic production capacity as well as stronger demands from South Korea and Europe as the prices of natural gas soar have bolstered the HBA to USD150.03 per tonne," said Head of Bureau of Communication, Public Information Services, and Cooperation of Ministry of Energy and Mineral Resources (EMR), Agung Pribadi, in Jakarta on Monday (6/9).

According to Agung, these factors have pushed the global prices up and set a record in the last few months.

Plateauing in February-April 2021, the HBA was on the hike during May-July 2021, touching USD115.35 per tonne in July 2021, while the September HBA is a new highest record.

For the record, the HBA is the price average of Indonesia Coal Index (ICI), Newcastle Export Index (NEX), Globalcoal Newcastle Index (GCNC), and Platt's 5900 of the previous month, with the quality made equivalent to the calorific value of 6322 kcal per kg GAR, total moisture 8%, total sulphur 0.8%, and ash 15%.

There are two derivative factors which affects the movement of the HBA, namely supply and demand. The derivatives of supply include season, mine techniques, the policies of the supplying countries, and supply chain techniques such as trains, barges, and loading terminal.

Meanwhile, the derivative of demand includes a declining demand for electricity which correlates with industries' conditions, import policies, and competition with other energy commodities such as LNG, nuclear, and hydro.

The September HBA will be used to set coal price on an FOB (Free-on-Board) vessel basis. (IY)

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

Agung Pribadi (08112213555)

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