Coal prices continue to strengthen. This can be seen from the Reference Coal Price (HBA) in September 2021 which reached USD150.03 per Ton. Ths is USD19.04 per tonne greater than the HBA in August 2021 which reached 130.99 per tonne. The increasing demand for coal in China due to the increasing need for power generation beyond the domestic coal supply capacity is the main trigger.
“This is a pretty phenomenal number in the last decade. China's high demand exceeds its domestic production capacity and the increasing demand for coal from South Korea and the European region along with high natural gas prices have catapulted HBA to USD150.03 per tonne,” said Head of the Communications Bureau of Public Information Services and Cooperation of the Ministry of Energy and Mineral Resources, Agung.
According to Agung, the factors mentioned above have pushed global coal prices to rise and record month-to-month records.
HBA recorded consecutive increases in the May-July 2021 period to touch the figure of USD115.35 per ton in July 2021. The increase continued to be consistent when in September 2021 a new record high was recorded.
HBA is the price obtained from the average of Indonesia Coal Index (ICI), Newcastle Export Index (NEX), Globalcoal Newcastle Index (GCNC), and Platt's 5900 in the previous month, with quality equivalent to 6322 kcal/kg calories. GAR, Total Moisture 8%, Total Sulfur 0.8%, and Ash 15%.
There are two derivative factors that affect the movement of HBA, namely, supply and demand. In terms of supply derivatives, it is influenced by season (weather), mining techniques, supplier country policies, to supply chain technicalities such as trains, barges, and loading terminals.
Meanwhile, the demand derivative factor is influenced by declining electricity demand, which correlates with industrial conditions, import policies, and competition with other energy commodities, such as LNG, nuclear, and hydro.