Coal prices are furious, factories are busy turning off generators

Jakarta, CNBC Indonesia – The high price of coal forced a number of factories to abandon this commodity as an energy source. Secretary General of the Association of Filament Yarn and Fiber Producers (APSyFI), Redma Gita Wirawasta, said that this step was inevitably carried out by many textile factories because the price of coal was too high.

“The condition now is that some of our members have switch, they turn off the generator and switch to PLN,” said Redma to CNBC Indonesia, Thursday (14/10/21).

Coal is not only used as an energy source, but also as a raw material for coal gasification. “We’ve been hit twice, di cost energy and raw material prices due to coal prices as well,” said Redma.

The current increase in coal prices is because Indonesia is following international prices, where according to the ICE Newcastle (Australia) market, yesterday the price fell by 1.92% to US$ 255/ton, but for the previous 3 consecutive days this commodity continued to increase by 15 0.61% and touched a record high of US$ 280/ton.

“Coal belongs to our homeland, which means that before exporting, we should have fulfilled it first. The problem with DMO (domestic market obligation) implemented 25% but the price goes international, this is also a bit strange. Because that’s what we have, the price should not be international, the coal belongs to the Indonesian people, leave it to the government, the government gives mining permits.

When the government grants mining permits, the government should be able to regulate what percentage is for local. According to him, if it is required to export, then following international prices then it will not be a problem. Meanwhile, for local, how much should be calculated? cost to mine plus profit then it is complete, so it does not follow the demand and supply in the international market.

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“The local price is special for us economically, as yesterday, it was regulated in that the gas price rose to USD9 per MMBTU, because the international price rose, but Pak Jokowi took the economic price (to USD6 per MMBTU) which is indeed our gas, and we also have coal. industry at an economic price, not international,” said Redma.

[Gambas:Video CNBC]

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