Chinese demand for Indonesian coal increases
September 4, 2014 Category Automotive Metals & Minerals, Minerals
Agritrade Resources, a coal miner in Indonesia with China as one of its top markets, aims to raise output and sales by 30% despite slowing Chinese consumption because of rising demand for less polluting coal. Ng Xin-wei, Chief Executive of the Hong Kong-listed company, said it planned to mine and sell 4.5 million to 5 million tons of coal during this financial year to March, up from 3.8 million tons and 2.8 million tons in the past two financial years. “Indonesia is close to both India and China, and its coal production cost is among the lowest in the world as 99% of its output is from surface mining,” Ng told the South China Morning Post. “It is cheaper to import seaborne coal into south China than from north China via railways.” But slower growth in electricity output is leading to lower coal demand as some 75% of the nation’s power is generated by coal. China imported 57.6 million tons of brown coal – with a relatively low heating value – from Indonesia last year, up from 50 million tons in 2012 and 35.7 million tons in 2011. Despite the lower heating value, most of the coal imported from Indonesia is blended with domestic coal to reduce pollutants. Agritrade Resources earlier this month posted a net profit of HKD115.2 million in the year to March, more than double the profit of HKD53.5 million in the previous year.
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