JAKARTA (TheInsiderStories) - Indonesian coal miner, PT ABM Investama Tbk (IDX: ABMM) targeting an increase in production volume to around 13 million tons (MT) of coal for next year, said the director last week. Until the end of 2020 the production is estimating around 11.5 MT of coal.
Adrian Erlangga, said the increase in prices was triggered by the rising demand in the Asian region and the price improvements. Earlier, due to the market conditions and pressured coal prices in this year have made the company hold its production levels.
In early 2020, ABM Investama plans to produce 15 MT of coal. However, taking into account market trends and prices, the producer cut the production around 19 percent of the targets. The issuer also continues to open up opportunities for the mining acquisitions in 2021.
As reported, the benchmark od coal price has continued to climbed in the last three months and closed at the level of US$59.65 per ton. The contract price for Newcastle thermal coal futures is already above $80 a ton.
According tot he executive director of the Indonesian Coal Mining Association (APBI), Hendra Sinadia, the upward trend in the black gold commodity price will continue next year. He rated, the increase in coal prices was caused by several factors.
First, the improving economic recovery in a number of countries, especially economic growth in China as the main market. Second, the coal market is also boosted by natural factors such as colder winters in the northern hemisphere, rain and waves in Indonesia, and cyclones in Australia.
Third, the existence of tensions in China’ trade relations with Australia also contributed to heating up the coal price and the commodity market. He predicts that the current price trend will last, at least until the middle of next year.
In addition, said Sinadia, the price and market movements in 2021 will also depend on how the COVID-19 pandemic is handled. With the pandemic still not over, he estimates that the miners will still wait and see or be careful in carrying out corporate actions, especially an expansion.
While, from the production side, the volume in the Work Plan and Budget that has been approved by the energy and mineral resources ministry will remain the benchmark. Demand is expected to be higher, so that production levels can be spurred more than this year, he concluded.
Written by Editorial Staff, Email: theinisderstories@gmail.com
