Coal - Indonesia mandates HBA

Coal - Indonesia mandates HBA Starting March 1, 2025, all coal exports must follow Indonesia’s Harga Batubara Acuan (HBA) benchmark. ESDM Director Julian Ambassadur confirmed Tuesday (Feb 25) that Minister Bahlil Lahadalia will issue a decree prohibiting alternative benchmarks like Indonesia Coal Index (ICI) and Newcastle Coal Futures, aiming to strengthen the country’s control over coal pricing. (Source : Kontan) Comment : The mandatory use of HBA for coal exports limits exporters’ pricing flexibility, which previously allowed them to choose benchmarks like ICI or Newcastle Coal Futures for optimal pricing. While aimed at standardizing prices, HBA’s less frequent updates could misalign with market trends, potentially disadvantaging miners. To avoid pricing inefficiencies and safeguard competitiveness, more frequent reviews and adjustments are crucial, ensuring HBA remains reflective of global prices and does not erode profit margins.