Tariff for domestic coal shipment may increase by 15 percent

The Indonesian National Shipping Association (INSA)plans to increase the shipping tariff for coal shipment by about 15 percent to cope with the planned increase in the fuel prices.

The association's chairman Oentoro Suryo said that the association had notified the government the association members would increase the tariff to between $7 and $8 per ton for domestic shipment from Kalimantan to Java.

The increase would take effect a month before the increase in the fuel price, he said.

Dometic shippers transports some 20 million tons of coal annually from coal production centers in Sumatra and Kalimantan to Java.

The government plans to raise the fuel prices in a bid to reduce the swelling fuel subsidy, but it has yet to decide when the new price would be announced.

He said there the association operated 10 bunker ships to transport coal both to domestic and international buyers. The planned increase in the fuel price would significantly raise the operating costs of the existing bunkers. According to him, each bunker uses between 27 tons and 30 tons of diesel oil per day. (dino)