Indonesian Thermal Coal Swaps Advance; China Prices Gain

Swaps prices declined for thermal coal from Indonesia, the world’s largest exporter of the power- station fuel, according to Ginga Petroleum Singapore Pte.

The swap for Indonesian sub-bituminous coal with a calorific value of 4,900 kilocalories a kilogram in the first quarter of 2013 gained 45 cents to $62.75 a metric ton on a net- as-received basis yesterday, Ginga said in an e-mail today. The January contract advanced 50 cents to $62.50 a ton.

A swap for 5,000 tons a month of Indonesian coal sold yesterday at $62.75 a ton for the first quarter, Ginga said.

Contracts for coal with a heating value of 5,500 kilocalories a kilogram for shipment to South China in the first quarter climbed 30 cents to $83.90 a ton on a net-as-received basis, the energy broker said. The swap for January held at $83.50.

A commodity swap is a financial agreement whereby a floating price is exchanged for a fixed rate over a specified contract period.

About 60 percent of Indonesia’s coal is classified as sub- bituminous. Higher moisture levels and a lower carbon content reduce the heating value compared with better-quality stock. Sub-bit coal has kilocalories of less than 6,100 per kilogram, according to the Indonesian energy ministry.

To contact the reporter on this story: Fitri Wulandari in Jakarta at fwulandari@bloomberg.net

To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net