Newcastle Coal Futures Surge to Highest Level Since December 2024 Amidst Geopolitical Tensions

Newcastle coal prices in the futures market for the March 2026 contract rose by 10.4% on Tuesday, March 3, 2026, reaching $139 per ton. This marks the highest level since December 2, 2024, and represents the largest daily increase in nearly three years, following a surge of 8.7% on Monday, March 2, 2026.

Drivers Behind the Price Increase

The strengthening coal prices coincide with an increase in the price of natural gas, a substitute for coal in electricity generation. The European benchmark Dutch TTF soared over 25% and increased almost 50% on Monday, March 2, 2026, while the Asian LNG benchmark S&P Global JKM jumped nearly 39%.

The rise in natural gas prices was triggered by news that QatarEnergy, the world’s largest liquefied natural gas (LNG) producer, halted LNG production at its Ras Laffan and Mesaieed facilities following an attack by Iranian drones. The Ras Laffan facility alone accounts for a fifth of global LNG supplies, and this shutdown is the first in its 30-year operating history.

Taiwan, heavily reliant on LNG supplies from Qatar, indicated it would increase its use of coal-fired power plants if disruptions from Qatar persisted and impacted natural gas supplies. Approximately 24% of Taiwan’s energy mix came from natural gas in 2023.

Impact on Coal Issuers

The increase in coal prices provided a short-term positive catalyst for coal stock movements. On Tuesday, March 3, 2026, share prices of several coal issuers strengthened:

• Adaro Andalan Indonesia ($GO) closed up 6.8%.
• Bukit Asam ($PTBA) rose 6.2%.
• Indo Tambangraya Megah ($ITMG) increased 6.4%.

Investors should continue to monitor geopolitical dynamics in the Middle East that drive energy price movements. Domestic regulatory uncertainty related to potential production quota cuts, export tariff increases, and changes to the domestic market obligation (DMO) also warrant attention.

Long-Term Outlook for Coal

Despite the short-term gains, the long-term sentiment for coal prices remains negative. The International Energy Agency (IEA) estimated in December 2025 that global coal demand will decline at a compound annual growth rate (CAGR) of -0.6% between 2025 and 2030, driven by the transition to renewable energy and increased LNG substitution.

Other Market Updates

• Danantara & INA Investment in TPIA: Danantara and the Indonesia Investment Authority (INA) signed a capital participation agreement worth $200 million in PT Chandra Asri Alkilias, a subsidiary of Chandra Asri Pacific ($TPIA). This follows a memorandum of understanding signed in June 2025. PT Chandra Asri Alkilias is constructing chlor–alkali and ethylene dichloride manufacturing facilities (CA–EDC) worth $800 million, expected to begin operations in 2027. TPIA also announced force majeure related to feedstock supply disruptions through the Strait of Hormuz.
• Nickel RKAB Approvals: Vale Indonesia ($INCO) is the only nickel company to have received RKAB (Work Plan and Budget) approval for 2026 as of March 2, 2026. Aneka Tambang is expected to receive approval in March 2026, allowing production to begin in April 2026, with a potential revision in July 2026.
• Cisarua Mountain Dairy (CMRY): CMRY is targeting revenue growth of 10–15% year-over-year in 2026 (compared to 19% YoY in 2025), with a gross profit margin of 40–44% and capital expenditure of IDR 800 billion.
• Erajaya Swasembada (ERA) & Sinar Eka Harmonious (ERAL): ERA recorded same-store sales growth (SSGS) of 39.2% YoY in January 2026, while ERAL noted SSGS of 25.5% YoY.
• Royaltama Mulia Contractorindo (RMKO): RMKO plans a rights issue of up to 512 million shares, diluting existing shareholders by up to 29.06%, to fund working capital.
• Unilever Indonesia (UNVR): UNVR completed the divestment of its SariWangi tea business for Rp1.5 trillion.
• Astra International (ASIA): Directors FXL Kesuma and Gidion Hasan purchased ASII shares, increasing their respective ownership stakes.
• AKR Corporindo (ACRA): Director Suresh Vembu sold AKRA shares, reducing his stake in the company.
• Arowana Citramulia (ARNA): ARNA plans a share buyback of up to IDR 100 billion.

Additional News

• The government is considering revising nickel production quotas in the 2026 RKAB by 25–30% in July 2026.
• Approximately 70–75% of issuers listed on the stock exchange are expected to meet the minimum increase in free float from 7.5% to 15% within the first year of the policy’s implementation.
• Brent oil futures for May 2026 rose 7.26% to $77.74 per barrel on Monday, March 2, 2026, driven by concerns over disruptions in the Strait of Hormuz.
• The government confiscated 5 million hectares of oil palm plantations and industrial forests from companies violating the law and collected IDR 7.4 trillion in fines.
• Pinasthika Mustika Partners ($MPMX) directors purchased MPMX shares as part of a long-term incentive program.
• Hero Global Investment ($HGII) operators Hendrianto Thamrin and Teddy Thamrin Chandra Ong purchased HGII shares, increasing their respective ownership stakes.
• Djaya Karya Property ($TABLE) plans to distribute bonus shares from share premium.