Thermal Coal (Steam Coal)

WHAT IS IT?
Thermal coal (also called steam coal) is coal burned to produce heat and generate electricity. It differs from metallurgical (coking) coal, which is used in steelmaking. Thermal coal accounts for about 75% of total coal production globally.

QUALITY PARAMETERS

GCV (Gross Calorific Value): Energy content in kcal/kg or MJ/kg. The primary quality measure.
NAR (Net As Received): Calorific value adjusted for moisture — the commercially relevant figure.
AshContent: Lower ash = less waste, more efficient combustion.
Sulphur: Lower sulphur = less SO₂ emissions, preferred by utilities.
Moisture: High moisture reduces effective energy content.

GRADES

6,500 NAR: Premium grade — Australia Newcastle benchmark.
5,900–6,000 NAR: Mid-range — common Indonesian export grade.
5,500 NAR: Lower grade — widely used in South and Southeast Asia.
4,200 NAR: Sub-bituminous — Indonesian low-rank coal, high volume/low price.

KEY USES

TRADE CORRIDORS

Major exporters: Indonesia (world's largest exporter — 400MT+/year), Australia, Russia, Colombia, South Africa
Major buyers: China, India, South Korea, Japan, Philippines, Malaysia, Vietnam
Tetra relevance: Indonesia → SEA corridor dominant. South Korea and Japan are major buyers.

PRICING BASIS

Benchmark: ICE Newcastle Futures (6,000 NAR FOB Newcastle, Australia). Indonesia HBA (Harga Batubara Acuan) — government reference price published monthly.

SPECIFICATIONS (Typical Indonesian Export 5,900 NAR)

ENVIRONMENTAL CONTEXT

Thermal coal faces long-term demand decline as renewable energy expands. Many European banks and investors have exited coal financing. Asia remains the dominant growth market but faces increasing regulatory pressure.