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06 December 2024

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Coal Weekly (29 Nov – 05 Dec 2024): Avg. USD 135.0/ton (-3.3% WoW)

Recent Catalysts Driving the Price

  • In the last five trading days, average coal prices dropped to USD 135.0/ton (-3.3% WoW), as traders showed reluctance to sign long-term contracts. Increased domestic supplies in China and India, alongside efforts by both governments to reduce import dependency, are expected to cap demand. Thus, India's coal imports are projected to fall to 206 Mt in 2025 from 265 Mt in 2024.
  • China's thermal coal demand in 2025 is projected to remain muted due to weaker-than-expected property sector stimulus, rising hydropower output, and potential US tariff hikes under Donald Trump. Imports are projected to slightly decline to 353 Mt, down from 380 Mt in 2024.
  • In light of economic uncertainties and growing pressure from renewable shift, we maintain our FY24 coal price forecast at USD 136/ton (YTD: USD 137.0/ton), with ADRO (TP IDR 3,400, reflecting 2025F P/E of 12.8x) as our top pick, primarily due to AADI spin-off and significant dividends.

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