Indonesia set its coal benchmark price at the highest in more than a decade, an official document published by its energy and minerals ministry showed on Monday, supported by sustained demand from China.
The ministry set the benchmark coal price at $115.35 per tonne in July, higher than the $100.33 per tonne in June and the highest since $117.6 per tonne in May, 2011, Refinitiv data showed.
“China’s domestic coal supply capacity continues to run low while power generation activities resume,” energy and mineral resources ministry spokesman Agung Pribad said in a statement, adding demand also increased from Japan and South Korea.
“This has an impact on the increase in global coal prices,” he said.
China unofficially banned imports from its top supplier Australia last year, with Chinese buyers informally told by custom officials not to purchase Australian coal.
This has resulted in China looking elsewhere to source coal, making Indonesia’s one of the biggest beneficiaries.
China signed a deal worth around $1.5 billion to buy Indonesian thermal coal last year.
(By Bernadete Christina Munthe and Fathin Ungku; Editing by Martin Petty and Ed Davies)