Demand for low calorie-coal on the rise

The demand for low-calorie coal from both local and international users has been on the rise lately due to the shortage of the high calorie coal in the market, Kompas daily reported on Saturday.

Yono Budiono, a site manager of PT Arutmin Indonesia, said on Friday that many users had now turned to a low-grade coal with a heating value of between 5,800 kcal/kg and 6,800 kcal/kg due to the shortage of the high-grade coal.

?The demand of the low calorie coal has reached 15 percent of the total demand. Previously, no buyers were interested in the low calorie coal,? he said. He added that Arutmin expected to increase the production from 14 million tons in 2003 to 18 million tons in 2004, of which 4.5 million tons would comprise of low-calorie coal.

According to Yono, even major coal users such as the Merak-based Suralaya plant which previously only used high-grade coal, has now started to order low grade coal. Several foreign buyers including India has also begun to buy low-calorie coal from Arutmin.

The shortage of the coal supply in the world market began late last year after China stopped its coal exports. This has resulted in the surge in the coal price to US$50 per ton from only $35 per ton. (*)