Indonesia, China First-Quarter Coal Swaps Rise; January Falls

Swaps prices gained for thermal coal for loading in first quarter from Indonesia, the world’s largest exporter of the fuel for power stations, 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 rose 30 cents to $64 a metric ton on a net-as-received basis on Dec. 24, Ginga said in an e-mail today. The January contract declined 15 cents to $63.55.

Contracts for coal with a heating value of 5,500 kilocalories a kilogram for shipment to South China in the first quarter climbed 20 cents to $85.30 a ton on a net-as-received basis, the energy broker said. Swaps for January fell 20 cents to $84.90.

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.

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