Coal Price at Decade High as Demand Soars ahead of Winter

TEMPO.CO, Jakarta - Coal price continues its rally to reach a new record—the highest in at least a decade. At the ICE Newcastle, September 30, coal was traded for US$206.25 per metric ton, 1.63 percent higher than yesterday's close.

Fahmy Radhi, an energy observer from Gadjah Mada University, said that this is the highest position over the last ten years.

“Before, coal never passed the US$200 mark. In early September the highest was only around US$150,” Fahmy told Tempo, Thursday.

Fahmi said that prices began climbing in August after spending the first half being corrected, falling as low as under US$100 per ton.

The main factor is the increasing demand from China and several major importers. Another factor is seasonal, as subtropical nations in the northern hemisphere prepare for winter. 

Ferdy Hasiman from Alpha Research Database shared Fahym's sentiment and said there is an increasing demand for coal shipments to China, Japan and South Korea, which pushes up the benchmark price.

Coal demand is on an uptrend as for power generation, transportation, and industries, along with economic recoveries in many countries.

Ferdy said the increase in commodity prices is a blessing for Indonesia. He added that analysts around the world are predicting coal prices to continue rising over the next two to three months.

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Francisca Christy Rosana | Maudey K. Setyakusuma