Toba Bara sets flat coal production target

By Brigida Ernestina Elu Wea

IDX-listed coal mining firm PT Toba Bara Sejahtera Tbk has set a coal production target of 5-7 million tons this year, about the same with last year?s output, amid the lingering market downturn.

Head of Investor Relations Iwan Sanyoto said Friday that the coal output would still be largely contributed by its coal concessions in East Kalimantan namely Adimitra Baratama Nusantara, Trisensa Mineral Utama, and Indomining.

Iwan said that to help cope with the current industry downturn, Toba Bara has applied a new marketing strategy by gradually increasing coal sales directly to end users. Currently, the company sells about 66 percent of output via traders, and 34 percent directly to end users. ?By selling directly to end users, price can be locked in long-term contract,? he said.

He added that the company will continue to seek markets as focus on China will be lessened. South Korea is currently its main export market, while other export markets include China, Taiwan, Malaysia, India, Japan, Vietnam and Thailand.

Elsewhere, Iwan said that Toba Bara will continue efficiency measures to deal with the current coal price drop and weak market.

As part of the efficiency drive, the company has set stripping ratio this year at about 11-12x, and to reduce overburden removal.

He said that as fuel is the largest cost component, the current drop in oil price has help reduced total cost.

Editing by Reiner Simanjuntak