The Increase of Coal Price

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    Coal price that increased on May to USD83.81 per tonne estimated to drive production of several coal mining companies in Indonesia. It has been encouraged by the high of overseas demand.

    This year, coal production is determined to 413 tonnes which dedicated to domestical use of 29 percent or similar to 121 million tonnes.

    According to the announcement of Ministry of Energy and Mineral Resources, coal price reference for May 2017 would be USD83.81 per tonne. It was better than in April 2017 of USD82.51 per tonne. Meanwhile, in April, it was determined to USD81.9 per tonne.

    The Head of Communication Bureau, Public Information Services, and Cooperation of Ministry of Energy and Mineral Resource, Sujatmiko said the key driver of Indonesia’s coal price reference was the high demand in India and China.

    The two countries are the world’s highest coal users. The coal price increase was triggered by the damage infrastructures occurred in the eastern Australia due to storms.

    “Besides the increasing demand from India and China, the Eastern Australia which caused the damage infrastructures is also affecting the coal price. Australia is playing an important role for the global coal price reference,” said Sujatmiko, in Jakarta, Sunday (5/14).

    Sujatmiko added that the government still put the current coal production to 413 million tonnes even though the coal price increased. The national coal reserves of the production estimated at 121 million tonnes.

    Compared with January 2017, coal price reference was USD86.23 per tonnes. It decreased, then, to USD83.32 per tonne in February and March 2017. Now, the price recovered. Businessmen said coal price remains positive this year.

    The Trigger

    One company lifted up the price was PT ABM Investama Tbk. Last year, its coal production was 6.4 million tonnes, now it is 9 million tonnes. High demand from India and China and the increase of coal price itself were the key triggers of the company’s consideration to raise the coal production.

    In line with PT ABM Investama, PT Darma Henwa Tbk would also increase its coal production to 23 million tonnes in 2017. Last year, it produced 17 million tonnes of coal.

    President Director of PT Adaro Energy Tbk, Garibaldi Thohir said the coal price has been improving since 2016. It affected the better performance and finance of the company. However, Adaro would continue its long-term coal production.

    “For further, our coal production still conservative at 52-54 million tonnes per year. In a long term, we must have enough reserves for power generator of our subsidiaries,” said Thohir after the annual general meeting of shareholders, in Jakarta. (Dds/Pas)

     

    Source : Kompas

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