Indonesia's coal export ban will keep upward pressure on prices -Japan utilities lobby

Okinawa Electric Power

14/01/2022 11:14

TOKYO, Jan 14 (Reuters) - Although Indonesia has partially
eased its coal export ban, upward pressure on thermal coal
prices will continue as it remains unclear when the situation
will return to normal, the head of the Japanese electric
utilities lobby said on Friday.   
    The world's biggest thermal coal exporter introduced an
export ban on Jan. 1 as inventories at local power plants were
at critically low levels.
    But it said on Thursday it would allow 37 vessels loaded
with coal to depart, in the strongest sign yet that the country
is relaxing its ban on shipments.  urn:newsml:reuters.com:*:nL1N2TT00G
    "As Indonesia is a major coal exporter, there will be a
certain amount of upward pressure on coal prices, though it
depends on how quickly things return to normal," Kazuhiro Ikebe,
the chairman of the Federation of Electric Power Companies,
Japan (FEPC), told reporters on Friday.
    ICE Newcastle monthly coal futures  NCFMc1  have risen to
their highest since October, up more than $50 a tonne since the
start of 2022.
    Ikebe, also president of Kyushu Electric Power  9508.T ,
said his company does not currently buy coal from Indonesia, but
it is trying to expand the types of coal it can use to ensure
stable supply in case other countries implement similar
measures. 
    "There are certain types of coals that can not be used or
are not suitable for our boilers, but we are trying to expand
the choice of coals that can be used through blending different
types," he said.
    Okinawa Electric Power  9511.T  purchases about half of its
thermal coal from Indonesia.
    "We were really worried as our cargo was stranded due to the
ban," Hiroyuki Motonaga, president of Okinawa Electric, told
another news conference, although he added the cargo had now
left Indonesia.
    "If the ban was prolonged, we would have to consider
operating other power plants or procuring coal from other
countries such as Australia," he said. 

 (Reporting by Yuka Obayashi; Editing by Kirsten Donovan)
 ((Yuka.Obayashi@thomsonreuters.com; +813-4520-1265;))