Compared to one year ago the HBA price has risen 49 percent, hence it is a more favorable environment for coal miners. However, the future direction of the coal price is very hard to predict as it highly depends on Chinese policies. The coal price is currently being supported by China's government. Authorities in the world's second-largest economy curbed coal production in an attempt to let the coal price rise. This then improves the financial situation of Chinese miners. Prior to these mining policies there had emerged concern about the non-performing loan (NPL) ratio in China's banking sector as coal miners encountered difficulty to repay debt to banks.

Read also: Overview of Indonesia's Coal Mining Industry

China lowered production hours at local coal mining sites, a policy that is evaluated every three months. If the nation wants to raise the coal price, then it simply decides to import coal. But when it decides to slow coal imports, then the price falls.

Indonesia's HBA price for thermal coal forms the basis for determining the prices of 75 Indonesian coal products and calculating the royalties that need to be paid by producers for each metric ton of coal they sell.

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

Month  2012  2013  2014  2015
 2016  2017
January 109.29  87.55  81.90  63.84  53.20  86.23
February 111.58  88.35  80.44  62.92  50.92  83.32
March 112.87  90.09  77.01  67.76  51.62  81.90
April 105.61  88.56  74.81  64.48  52.32  82.51
May 102.12  85.33  73.60  61.08  51.20  83.81
June  96.65  84.87  73.64  59.59  51.87  75.46
July  87.56  81.69  72.45  59.16  53.00  78.95
August  84.65  76.70  70.29  59.14  58.37
September  86.21  76.89  69.69  58.21  63.93
October  86.04  76.61  67.26  57.39  69.07
November  81.44  78.13  65.70  54.43  84.89
December  81.75  80.31  69.23  53.51 101.69

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

Indonesian Production, Export, Consumption & Price of Coal:

  2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Production
(in mln tons)
 217  240  254  275  353  412  474  458  461  434
Export
(in mln tons)
 163  191  198  210  287  345  402  382  366  343
Domestic
(in mln tons)
  61   49   56   65   66   67   72   76   87   91
Price (HBA)
(in USD/ton)
  n.a   n.a  70.7  91.7 118.4  95.5  82.9  72.6  60.1  61.8

Sources: Indonesian Coal Mining Association (APBI) & Ministry of Energy and Mineral Resources

Bahas