Jakarta, CNBC Indonesia- Coal prices are still not separated from the correction trend. In fact, recently the price drop is so severe.
Yesterday, the price of coal on the ICE Newcastle (Australia) market was recorded at US$ 139/ton. A drop of 10.26% from last weekend’s position was the lowest since July 12, 2021.
Coal prices have now even fallen for four consecutive days. During those four days, the price of the black stone fell 30.85%. Wow…
It seems that China’s ‘move’ to suppress coal prices is powerful as well. Yes, President Xi Jinping’s government is serious about guessing the price of coal.
China has really felt the impact of the surge in coal prices, which since the end of 2020 (year-to-date) still posted a 70.03% gain. Around 60% of power plants in the Bamboo Curtain country use coal as a primary energy source.
The high price and the depletion of supply have forced a number of regions in China to carry out rotating power cuts. This causes tremendous production disruptions and threatens the prospects for China’s economic growth.
“Average daily production has reached more than 11.5 million tons in the past few days since mid-October. The figure is 11.7 million tons,” the Chinese National Development and Reform Commission (NDRC) said in a written statement.
Meanwhile, the new supply of coal to the Steam Power Plant (PLTU) has now reached 8.32 million tons. This is the highest in history.
Thus, the total stock of coal in the PLTU is 106 million tons, an increase of more than 28 million tons compared to the position at the end of September. This stock is enough for 19 days. Even the NDRC estimates that the stock of coal in the power plant could be above 110 million tons in the next three days.
China is the world’s largest coal consuming country. So if the supply in China is safely controlled and conducive, then there is nothing to worry about. The business world does not have to pay a lot to buy coal because the supply is adequate.
China’s coal market is starting to stabilize, so the price of this commodity is no longer ‘prancing around’. Coal prices have calmed down.
CNBC INDONESIA RESEARCH TEAM
(aji / aji)