Jakarta, CNBC Indonesia – The trend of increasing coal prices in recent months is being enjoyed by producers, including PT Bumi Resources Tbk (BUMI). In the first quarter of 2021, the company’s realized coal price rose to US$ 53.1 per ton from the previous US$ 49 per ton on average in the last three months.
“The company’s coal price realization is expected to continue to rise in the second quarter of 2021 when compared to the price index in the first quarter,” the company wrote in its report, Tuesday (6/7/2021).
This year, the company projects the coal price to be in the range of US$ 53-56 per ton. For BUMI’s subsidiary, Kaltim Prima Coal, the price of coal is estimated at US$ 60-64 per ton, while Arutmin’s is at US$ 39-42 per ton. The company projects that coal production will recover in the third and fourth quarters of 2021. During the first quarter of 2021, the company’s sales of coal production fell to 19.3 million tons due to high rainfall in the mining area
This price increase will give the company more profit, especially due to the decrease in production costs to US$ 33.9 per ton, compared to the previous US$ 34.33 per ton.
Recently, the price of coal has soared to touch the latest record.
Yesterday, the price of coal on the ICE Newcastle (Australia) market was recorded at US$ 137.75/ton. It’s up 3.75% over the previous day and is at its highest since at least 2008.
Demand for coal is also soaring in Europe. The European Energy Exchange noted that electricity generation by coal plants in Germany rose 5% last week compared to the previous week to 4,318 MWh. Compared to the same period the previous year, there was even a 99% jump!
In May 2021, Refinitiv reported Germany’s coal imports were 1.02 million tonnes. Soared 47.86% compared to the previous month and 92.31% from the same period in 2020. The increase in electricity demand cannot be separated from the stretching of the country’s manufacturing sector.
Previously, Director and Corporate Secretary Dileep Srivastava said that this year is an optimism for the coal sector with an upward trend in prices that is expected to persist. The price increase was also due to production in Australia, Indonesia and China being affected by the pandemic.
“Demand, however, is expected to rise and coal prices are strong and will likely remain so throughout the year,” Dileep said recently.
Bumi Resources recorded a net profit of US$ 25.1 million in the first quarter of 2021, up 246% compared to the same period in 2020 with a loss of US$ 17.2 million. Meanwhile, the company’s revenue during the first quarter of 2021 was recorded at US$ 1.04 billion, down 3% compared to the first quarter of 2020.
“Even though BUMI’s production decreased, it managed to record a 15% increase in revenue in the first quarter of 2021 compared to the fourth quarter of 2020, this shows the recovery of coal prices, and this trend is still continuing,” said Dileep
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