July 14, 2014 / 8:14 AM / 5 years ago

Indonesia coal production, exports increase in H1 2014 -govt

JAKARTA, July 14 (Reuters) - Indonesia produced 213 million tonnes of coal in the first half of 2014, a government official said, up 7.6 percent from the same period last year despite a continuing decline in benchmark prices and efforts to limit output and control exports.

Southeast Asia’s largest economy exported 158 million tonnes of the output, Gultom Guska, head of coal production and marketing supervision at the mining ministry, told Reuters via a text message late on Friday.

The exports were up from 148 million tonnes exported in the first half of 2013, he said, a 6.8 percent increase.

Indonesia is the world’s top exporter of thermal coal, much of which is used to fuel power stations in energy-hungry Asia.

Earlier a mining ministry official had forecast thermal and coking coal output this year to remain flat at 421 million tonnes, with the government planning to limit production and tighten controls on exports.

To compensate for declining prices and fill contractual commitments, however, Indonesia’s top six coal producers have targeted an average increase in production of 11.7 percent this year.

Guska did not give a reason for the increase, but noted that Indonesia’s benchmark HBA prices for coal with a calorific value of 6322 GAR (gross as received) hit $72.45 per tonne in July, $1.19 per tonne below the June HBA price.

The country’s main coal industry association warned in June that if prices remained below $73 a tonne this year some firms would go out of business. Government plans to hike royalties could also eat into miners’ revenues.

Asia’s benchmark weekly Newcastle index has fallen about 20 percent since the beginning of the year and currently sits at around $69.90 a tonne, its lowest in nearly five years. (Reporting by Wilda Asmarini; Writing by Fergus Jensen; Editing by Tom Hogue)

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