Sugar Barons (2)
Sugar market in Indonesia is still controlled by old players, including those fall into the category of ‘seven samurai’. But, in the past few years, we’ve seen growing interest of other major business groups in the country, including those with interest in plantation and food & beverage business. Some of their projects failed, but others proceeded. So, before talking about the established players, let’s recap those new players.
Sugar Barons (1)
Sugar is a politically sensitive issue in Indonesia. Not only because of protection of domestic production vs import or between farmers and corporations or between state companies and private entities. It is because political connections of key players in the industry, where they shared short-term interests.
Melati Family & Geo Energy Resources
Indonesian businessman Kasmadi Melati made headlines in Singapore five years ago (October 2012) when he donated S$1 million to the National Kidney Foundation (NKF), making it the largest donation from a living individual donor in 13 years. The same month, Geo Energy Resources Ltd, Indonesian coal producer controlled by Melati family, kicked off trading of stocks on the Singapore Exchange (SGX).
Coal Journal No. 28/2017
Thermal coal returned to US$81.7 per ton Thursday (Jul 6), the highest level in several weeks on short-term supply-demand balance in Asia Pacific. In the meantime, Indonesian government set reference price of coal (HBA) for July 2017 at US$78.95 per ton, an increase of 4.6% from June and nearly 49% jump year-on-year.
Bauxite Ore Export License for DSM: Implications?
Ministry of energy and mineral resources has granted recommendation for PT Dinamika Sejahtera Mandiri (DSM) to export 2.4 million tonnes of washed bauxite ores until July 2018. DSM is the second company after Aneka Tambang allowed to export bauxite ores since the new policy issued early this year.
More Nickel Supply from Indonesia: What a Waste!
Ministry of energy and mineral resources has just issued export recommendation for 2.3 million tons of low-grade nickel ores (nickel content less than 1.7%) per annum to PT Ceria Nugraha Indotama, adding supply of up to 39,000 tons of pure nickel per annum in the international market.
New Regulation for Cost Recovery of Oil & Gas
President Joko ‘Jokowi’ Widodo has on June 15, 2017 signed Government Regulation No. 27/2017 about cost recovery and income tax treatment for upstream oil and gas operations to amend GR No. 79/2010. The new regulation is expected to boost investment climate in the industry amidst declining reserves.
Keppel Gas Strategy & Indonesia
Keppel Group has just released a briefing to analysts this morning about the group’s gas strategy in a bid to tap the growing gas demand, which double the traded natural gas in 13 years time, while limited new gas projects will pressure supply side in the following years. Keppel expects market tightness over the next decade due to slowdown in investments amidst low oil price and high cost environment.
Coal Journal No. 27/2017
Thermal coal fell 3.91% to US$77.5 per ton Thursday (June 29), but the commodity gained 33.9% year-on-year. Perception about higher supply in the seaborne market might have contributed to the correction. China’s plan to ban coal imports at its second-tier ports effective July 1st, 2017 also affected the mood.
Resources Prima vs ABM Investama
While other coal producers enjoyed recovery in the past few quarters, SGX-listed Resources Prima Group Ltd’s future is on the line, which might significantly affecting financials of PT Cipta Kridatama, coal mining contracting subsidiary of ABM Investama (ABMM).