The HBA (Harga Batubara Acuan), or Indonesian Coal Price Index, was cut notably for December amid weaker market conditions, according to the Ministry of Energy and Mineral Resources (ESDM).

In December, the HBA for 6,322 Kcal/kg GAR coal was set at $117.38/t, down from $139.8/t a month earlier, a 16.0% fall month on month. The index is used for pricing reference for 6,100-6,500 Kcal/kg GAR cargoes.

Additionally, HBA I, gauging 5,300 Kcal/kg GAR, was priced at $85.92/t, compared with $103.2/t a month earlier, down 16.7% month on month. This index serves as a reference for 5,100-5,500 Kcal/kg GAR coal.

HBA II, measuring 4,100 Kcal/kg GAR as a reference for 3,900-3,600 Kcal/kg GAR coal, was set at $57.7/t, compared with $52.86/t for November, a 9.2% rise.

The HBA III, which is based on 3,400 kcal/kg GAR coal and serves as a reference for lower grades between 3,200-3,600 kcal/kg GAR, was set at $34.18/t, up 20% from $28.49/t in the previous month.

The HBA, as well as three other indexes, is used to determine the royalty amount that coal producers need to pay to the government, reference coal contracts and pricing formulas in Indonesia, and determine the prices of 77 Indonesian coal products.

The index now derives from 30% of the fourth week of the month preceding the previous month and the first week of the previous month, along with 70% of the second and third weeks of the previous month.

(Writing by Alex Guo  Editing by Harry Huo)
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