The Indonesian Agency for Meteorological, Climatological and Geophysics (BMKG) said unusually wet weather in Indonesia - brought about by the La Nina weather phenomenon - is expected to disrupt coal production, export and logistics in the July-January period on the islands of Sumatra and Kalimantan, the two key coal producing regions in Indonesia, the world's largest exporter of thermal coal.

La Nina is the opposite of the El Nino weather phenomenon that disrupted Southeast Asia's agricultural commodities in the second half of 2015 and early 2016 by bringing severe dry weather. La Nina, on the contrary, brings cooler-than-average sea temperatures in the central and eastern tropical Pacific Ocean, hence causing wetter-than-usual weather in Southeast Asia. Just like El Nino-inflicted droughts disturb agricultural output, La Nina-inflicted heavy and prolonged rainfall also disrupts harvests (due to floods or landslides). Analysts see a big chance of La Nina occurring in the second half of 2016.

Indonesian Government's Benchmark Thermal Coal Price (HBA):

Month    2012    2013    2014    2015
   2016
January   109.29    87.55    81.90    63.84    53.20
February   111.58    88.35    80.44    62.92    50.92
March   112.87    90.09    77.01    67.76    51.62
April   105.61    88.56    74.81    64.48    52.32
May   102.12    85.33    73.60    61.08    51.20
June    96.65    84.87    73.64    59.59    51.87
July    87.56    81.69    72.45    59.16
August    84.65    76.70    70.29    59.14
September    86.21    76.89    69.69    58.21
October    86.04    76.61    67.26    57.39
November    81.44    78.13    65.70    54.43
December    81.75    80.31    69.23    53.51

in USD/ton
Source: Ministry of Energy and Mineral Resources

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