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Monday, 06 May 13
INDONESIAN COAL PRICE REFERENCE FALLS CONTINUE


COALspot.com -  The Indonesian government’s declared coal bench mark price has lost $ 3.23  / MT in May 2013.

The monthly coal price reference for coal sales in May 2013 lost 3.65  percent compared to last month. The Ministry of Energy & Mineral Resources of Indonesia sets the coal’s spot price for May 2013  at US$ 85.33 per ton, US$ 3.23 lower than April 2013 bench mark Price.

HBA is on a rising trend since November 2012, but lost its way to reach US$ 100/ MT since last month.

This coal benchmark price was calculated based on calorific value of 6,322 kcal/kg (GAR), stated to be using formula based on the March 2013 index average of ICI-1 (Indonesia Coal Index) 25%, Platts-5900 25%, NEX (Newcastle Export Index) 25%, and GC (globalCoal Index) 25%.

Assessment basis of coal price reference was calculated considering coal with GCV (GAR)  6,322 kcal/kg, Total Moisture (arb) 8.00%, Total Sulphur 0.8% (arb), Ash Content 15 % (arb) and  delivery free on Board (FOB) Vessel basis and applicable for spot contract, delivery between 1 – 30 April 2013.

The government of Indonesia has been publishing a monthly coal reference price (HBA & HPB) since January 2009 to be used by coal producers for all spot and term contracts. However, the full implementation of HBA has started only since September 2011.

The May 2013 HBA is 16.44 percent or $ 16.79 lower Y-o-Y basis.

February 2011 declared HBA was the highest  since the launching of HBA by government of Indonesia (US$ 127.05 / MT) but lowest was declared in May 2009 (US$ 62.83/ MT).

The price was only valid for the spot price (loading on or before 31 May 2013), while as for term price (up to 12 months supplies), the average reference price (HPB) of the previous three months will be used to determine the selling price. (50% of the latest available month HPB, 30% of one month prior HPB and 20% of two-month prior HPB).

Government also declared price marker for eight brands of Indonesia's coal, which are most commonly traded in the market. Those eight brands are acted as the benchmark and used to calculate other 63 coal types with a quality similar to the coal price markers.

For sales in the barge, the reference price is reduced by barging and transshipment costs from barge to vessel. Government has recently issued a regulation (644.K/30/DJB/2013 dated 21 March 2013) to regulate or determine  coal prices on FOB barge.  Government also fixed the freight for barging, surveyor, insurance and etc.. to determine FOB barge price.

The coal price reference, which has been established to fulfill the requirement of mining law 04/2009 and latest ministerial decree 17/2010 and also aims to increase government revenue from royalties from coal producers.

Click here  for complete Indonesian coal price reference since January 2009.(cs)



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