Bumi raises 2005 coal price target
Thursday, October 7 2004 - 01:15 AM WIB
The company raised its 2005 average price forecast for thermal coal used by power plants, to US$38 a metric ton next year, from $35 this year, Bumi finance director Eddie Soebari said in a telephone interview after a shareholders? meeting. The company cut its 2004 production estimate, Eddie said.
Coal prices have jumped as China, the world?s biggest producer, reduced exports of the fuel to feed surging demand from its steelmakers and electricity companies. Benchmark contract prices for thermal coal may rise 10 percent to $49.50 a ton next year, Merrill Lynch & Co, forecast in June.
?Demand is still high, especially from China,? Eddie said in Jakarta.
?We are also seeing power plant growth in India and the Philippines.?
Bumi?s 2004 average price of $35 a ton is higher than its average selling price of between $31 to $32 a ton earlier this year. Last year, the company?s average coal price was $25.50 a ton and production cost was about $19 a ton.
Bumi had profit of $100 million from January to September, Eddie said. The company didn?t give a comparable figure in dollars for a year earlier as earnings then were denominated in rupiah.
It earned Rp 65 billion ($7 million) between January and September 2003, it said in a statement last year. Bumi maintained its full-year profit forecast at $137 million, while sales are expected to reach about $1.2 billion, Eddie told reporters earlier.
Bumi lowered its 2004 coal output estimate to 40 million tons from 43 million tons, Eddie said. He forecast 2005 production to rise 13 percent to 45 million tons. Last year, it produced 29 million tons of coal.
?We understand there will be heavier rains and will create difficulty in getting equipment to the mines,? he said.
Bumi?s output rose after it bought East Kalimantan-based coal producer PT Kalimantan Prima Coal (KPC), and PT Arutmin Indonesia, which has coal mines in South Kalimantan. (*)