FOB, CFR, or CIF Indonesian Steam Coal Quotation Guide

International buyers frequently ask coal suppliers a simple question:

“What is your best price for Indonesian steam coal?”

However, a reliable coal quotation cannot be calculated from the calorific value alone. The final price depends on the coal specification, order quantity, loading point, vessel arrangement, destination port, inspection requirements, payment terms, and the selected Incoterm.

A request for FOB Indonesian steam coal is therefore fundamentally different from a request for CFR or CIF delivery.

Understanding these differences helps buyers obtain faster, more accurate, and commercially comparable offers from an Indonesian steam coal supplier.

Why the Incoterm Matters in a Coal Quotation

Incoterms® are standardized international trade terms created by the International Chamber of Commerce. They clarify the allocation of costs, transportation responsibilities, export and import formalities, insurance obligations, and the point at which risk transfers from the seller to the buyer.

For bulk Indonesian thermal coal shipments, the most frequently discussed terms are:

FOB — Free on Board
CFR — Cost and Freight
CIF — Cost, Insurance and Freight

These terms apply to sea or inland waterway transportation. They must always be followed by a clearly named port or delivery point and the applicable Incoterms® version, preferably Incoterms® 2020.

For example:

FOB Taboneo Anchorage, Indonesia, Incoterms® 2020
CFR Chattogram Port, Bangladesh, Incoterms® 2020
CIF Mundra Port, India, Incoterms® 2020

A quotation that only says “FOB Indonesia” or “CIF buyer’s country” is not sufficiently precise.

What Is an FOB Indonesian Coal Quotation?

Under FOB, the seller delivers and loads the coal on board the vessel nominated by the buyer at the agreed port of shipment. The seller handles the export formalities, while the buyer normally appoints the vessel, pays the ocean freight, arranges marine insurance, and assumes the risk after the coal has been loaded on board.

In the Indonesian coal market, buyers may encounter several FOB-based arrangements.

FOB Barge or FOB Tongkang

Under an FOB barge arrangement, coal is delivered and loaded onto a barge at the agreed loading point.

The quotation may include:

Coal supply from the mine or stockpile
Hauling to the loading point
Stockpile handling
Coal sampling and analysis
Loading onto the barge
Relevant local documentation
Export-related arrangements, where applicable

The buyer should confirm what happens after the coal is loaded onto the barge. Transshipment to a mother vessel, floating crane costs, barge waiting time, anchorage costs, and ocean freight may remain outside the seller’s quotation unless expressly included.

Therefore, “FOB barge” should identify:

The exact loading point or jetty
The barge capacity
The delivery and risk-transfer point
Who arranges the mother vessel
Who pays for transshipment
Who bears demurrage or waiting costs

FOB Mother Vessel or FOB MV

Under an FOB MV arrangement, the seller delivers and loads the coal onto the nominated mother vessel according to the agreed contractual arrangement.

Compared with FOB barge, an FOB MV price may include additional costs such as:

Barge transportation to anchorage
Floating crane or transshipment services
Loading onto the mother vessel
Anchorage-related handling
Draft survey or independent inspection
Export documentation

Indonesia Export Center currently prioritizes inquiries based on FOB barge, FOB tongkang, and FOB mother vessel, subject to seller confirmation, coal availability, loading arrangements, buyer documentation, and commercial feasibility.

What Is a CFR Indonesian Coal Quotation?

CFR means Cost and Freight.

Under CFR, the seller:

Supplies the coal
Completes export formalities
Loads the coal onto the vessel
Contracts and pays for freight to the named destination port

However, the risk of loss or damage still transfers to the buyer when the coal is loaded on board the vessel at the Indonesian port of shipment—not when it arrives at the destination.

The seller is not required to purchase marine cargo insurance under CFR. The buyer should arrange suitable insurance coverage independently.

A simplified CFR calculation is:

CFR price = FOB price + ocean freight and agreed carriage costs

A CFR quotation cannot be calculated accurately unless the buyer provides:

Exact destination port
Required shipment quantity
Vessel size
Preferred shipment period or laycan
Port draft restrictions
Discharge rate
Vessel gear requirements
Any destination-specific restrictions

For example, a freight estimate for a 10,000 MT shipment may differ substantially from the freight for a 50,000 MT shipment, even when the coal specification and destination country are the same.

What Is a CIF Indonesian Coal Quotation?

CIF means Cost, Insurance and Freight.

The commercial responsibilities under CIF are generally similar to CFR, but the seller must also arrange marine insurance covering the buyer’s transit risk.

Despite the seller paying the freight and insurance to the destination port, the risk normally transfers to the buyer when the coal is loaded onto the vessel at the port of shipment. CIF does not mean that the seller retains all cargo risk until arrival.

Under Incoterms® 2020, the default insurance requirement for CIF generally corresponds to Institute Cargo Clauses (C), unless the parties agree on broader insurance coverage. Buyers requiring more extensive protection should clearly specify the required insurance clauses in the inquiry and contract.

A simplified CIF calculation is:

CIF price = CFR price + agreed marine insurance cost

The CIF quotation should clearly state:

Insured value
Insurance coverage level
Insurance company or eligibility requirements
Covered voyage
Claims procedure
Exclusions
Required insurance certificate

FOB vs CFR vs CIF: Quick Comparison

Commercial Point	FOB	CFR	CIF
Seller supplies and loads the coal	Yes	Yes	Yes
Seller handles export formalities	Yes	Yes	Yes
Seller pays ocean freight	No	Yes	Yes
Seller arranges cargo insurance	No	No	Yes
Buyer normally nominates vessel	Yes	Usually no	Usually no
Risk transfers when loaded on board	Yes	Yes	Yes
Destination port must be specified	For freight planning	Yes	Yes
Suitable for bulk coal	Yes	Yes	Yes

The critical distinction is that the party paying the freight is not necessarily the party bearing the cargo risk during the voyage.

Which Incoterm Is Most Suitable for a Coal Buyer?

Choose FOB When:

FOB may be suitable when the buyer:

Has access to competitive vessel or chartering rates
Has experience arranging bulk cargo shipments
Wants control over the vessel, freight, and insurance
Has a nominated shipping line or chartering partner
Can coordinate the laycan with the seller’s loading schedule

FOB can also make it easier to compare the underlying coal price separately from ocean freight.

Choose CFR When:

CFR may be appropriate when the buyer:

Wants the seller to arrange ocean freight
Has its own marine cargo insurance
Wants a delivered-to-port freight calculation without seller-arranged insurance
Can provide complete destination-port and vessel information

CFR is commonly suitable for bulk commodities because it allows the seller to arrange freight while the buyer controls insurance. ICC guidance specifically recognizes CFR as appropriate for bulk, non-containerized goods and raw materials.

Choose CIF When:

CIF may be considered when the buyer:

Wants the seller to arrange both freight and marine insurance
Does not have an established cargo-insurance arrangement
Requires an insurance certificate for banking or import documentation
Accepts the insurance coverage arranged by the seller

However, buyers should review the insurance terms carefully instead of assuming that all possible risks are covered.

Information Required for an Accurate Indonesian Coal Quotation

To receive a workable offer, the buyer should submit the following information.

1. Required Coal Grade

State the required calorific value clearly.

Examples include:

Low-calorie coal GAR 4200–4400
Low-calorie coal GAR 4800–5000
High-calorie coal GAR 5300–5500
High-calorie coal GAR 5600–5800
High-calorie coal GAR 5800–6000
Premium high-calorie coal above GAR 6000, subject to availability

Buyers sourcing low-calorie coal GAR 4200–5000 should not request only “low-grade coal.” Similarly, buyers looking for high-calorie coal GAR 5300–6600 should identify the exact target GAR and acceptable tolerance.

The final offerable grade must be confirmed according to the latest mine source, stockpile condition, production batch, certificate of analysis, and independent survey results.

2. Complete Coal Specification

GAR alone is insufficient. The inquiry should include:

Gross calorific value on an as-received basis
Total moisture
Inherent moisture
Ash content
Total sulfur
Volatile matter
Fixed carbon
Hardgrove Grindability Index
Coal size
Acceptable tolerance
Rejection limits
Required testing standard

The buyer should also state the analytical basis for every parameter, such as ARB, ADB, or DB. Comparing ash or sulfur values without confirming the analytical basis can lead to incorrect commercial comparisons.

Indonesia Export Center advises buyers to request the latest COA, surveyor report, stockpile information, loading-point details, mine-source confirmation, and seller-readiness confirmation before final purchase documents are issued.

3. Required Quantity

Specify whether the requirement is:

Spot cargo
Trial shipment
One barge
One mother-vessel cargo
Monthly supply
Annual contract
Long-term supply program

Include the exact quantity in metric tons and the acceptable operational tolerance, such as “50,000 MT ±10% at seller’s option,” when applicable.

The shipment quantity affects:

Barge requirements
Mother-vessel size
Loading schedule
Freight rate
Port compatibility
Inspection costs
Commercial price

4. Exact Incoterm and Delivery Point

Avoid writing only:

“Please quote FOB, CFR, and CIF.”

Instead, request a specific basis:

“Please quote FOB mother vessel at Taboneo Anchorage, Indonesia, Incoterms® 2020.”

Or:

“Please quote CFR Mundra Port, India, Incoterms® 2020.”

Or:

“Please quote CIF Chattogram Port, Bangladesh, Incoterms® 2020, including details of marine insurance coverage.”

When asking for several options, list each option separately.

5. Destination Port

For CFR or CIF quotations, provide:

Destination-port name
Country
Port terminal, if known
Maximum vessel draft
Maximum vessel size
Discharge rate
Port working hours
Required vessel gear
Any port restrictions

The destination country alone is not enough because freight and port conditions may vary between ports in the same country.

6. Shipment Schedule

Provide:

Preferred loading month
Target laycan
Latest acceptable shipment date
Required monthly frequency
Contract duration

Coal availability, barge scheduling, loading equipment, weather, vessel availability, and stockpile readiness can affect the proposed shipment window.

7. Inspection and Surveyor Requirements

State whether inspection will be conducted by:

An independent international surveyor
A mutually agreed surveyor
A government-appointed surveyor
The seller’s laboratory
The mine laboratory

Clarify whether the analysis at the loading port is final and binding for:

Quality
Weight
Draft survey
Moisture
Sampling
Rejection
Price adjustment

Coal is transported as a solid bulk cargo. The IMO’s mandatory IMSBC Code provides safety requirements for the loading, trimming, carriage, and discharge of solid bulk cargoes and addresses hazards including cargo stability and chemical reactions. Shipment planning and documentation should therefore follow the applicable bulk-cargo safety requirements.

8. Required Export Documents

Depending on the transaction and destination, buyers may request:

Commercial invoice
Bill of lading
Certificate of origin
Certificate of analysis
Surveyor report
Weight certificate
Draft survey report
Export declaration
Insurance certificate for CIF shipments
Vessel and barge documents
Other destination-country documents

Buyers should verify import requirements in their own country before finalizing the contract.

9. Payment Terms

The inquiry should state the preferred payment method and provide the necessary banking or supporting documentation.

Possible arrangements are subject to the seller’s procedure, buyer credibility, transaction structure, issuing bank, cargo size, and final contract.

Payment terms, Incoterms, and shipment terms are separate commercial matters and should all be stated clearly.

10. Buyer Company Information

A serious RFQ should include:

Buyer company name
Registered address
Company website
Contact person
Company profile
Business registration
Import license, where applicable
Previous coal-import experience
End-user or trading status
Letter of Intent
Target quantity and schedule
Proof of financial capability when requested

Complete company information allows the supplier to assess commercial feasibility and coordinate with the relevant mine, stockpile, logistics, surveyor, exporter, and vessel partners.

Recommended RFQ Format for Indonesian Steam Coal

Buyers can use the following format:

Product: Indonesian Steam Coal / Thermal Coal
Required Grade: GAR ______ kcal/kg, ARB
Total Moisture: ______% maximum, ARB
Ash: ______% maximum, basis ______
Total Sulfur: ______% maximum, basis ______
Volatile Matter: %, basis ______
HGI: ______ minimum
Coal Size: ______ mm
Quantity: ______ MT ±%
Order Type: Spot / Monthly / Annual Contract
Delivery Term: FOB Barge / FOB MV / CFR / CIF
Named Loading or Destination Port: ______
Shipment Schedule or Laycan: ______
Discharge Rate: ______ MT per day
Inspection: ______
Required Documents: ______
Payment Method: ______
Target Price, if available: USD ______ per MT
Buyer Company: ______
Destination Country: ______
Additional Requirements: ______

Submitting this information does not guarantee immediate acceptance, but it allows the supplier to calculate a quotation based on realistic specifications and shipment conditions.

How to Compare Two Indonesian Coal Offers

Do not compare two quotations based only on the USD-per-ton figure.

Before selecting an offer, confirm that both quotations use the same:

GAR level
Analytical basis
Moisture and ash limits
Sulfur limit
Quantity
Loading point
Incoterm
Freight assumption
Vessel size
Inspection procedure
Payment terms
Offer validity
Price-adjustment mechanism
Rejection limits

A lower-priced coal offer may become more expensive when its lower calorific value, higher moisture, additional transshipment cost, or unfavorable freight arrangement is considered.

For a basic energy-cost comparison, buyers may calculate:

Energy per metric ton in GJ = GAR × 0.0041868

Then:

Delivered fuel cost per GJ = Landed price per MT ÷ Energy per MT

This helps compare GAR 4200 coal with GAR 5000, GAR 5500, or higher-calorie coal on an energy basis rather than only on the price per metric ton.

Operational suitability, boiler design, combustion efficiency, emissions requirements, and ash-handling costs should also be considered.

Why Quotations Should Have a Validity Period

Coal prices, barge availability, ocean freight, fuel costs, port congestion, vessel schedules, insurance premiums, and currency conditions can change.

Every quotation should therefore state:

Quotation date
Price validity
Shipment period
Subject-to-availability clause
Freight validity
Conditions requiring price revision

A freight-based CFR or CIF quotation generally requires stricter validity than an indicative FOB coal price because vessel rates may change before the buyer accepts the offer.

Requesting a Quotation from Indonesia Export Center

Indonesia Export Center connects international buyers with selected Indonesian coal supply networks and supports inquiries for industrial users, coal traders, power plants, cement manufacturers, and commodity-trading companies.

Available inquiries may include:

Indonesian steam coal supplier requirements
Low-calorie coal GAR 4200–5000
High-calorie coal GAR 5300–6600 requirements, subject to exact seller and mine confirmation
FOB barge or FOB tongkang
FOB mother vessel
Spot cargo
Monthly supply
Long-term contract discussions

The company’s currently stated commercial preference is for FOB-based inquiries. CFR or CIF requests may only be considered when specifically confirmed by the seller.

To request a quotation, send:

Required GAR
Full coal specification
Quantity
FOB, CFR, or CIF requirement
Loading or destination port
Shipment schedule
Payment preference
Required documents
Buyer company profile
Letter of Intent

Conclusion

Choosing between FOB, CFR, and CIF is not simply a matter of selecting the lowest price.

FOB gives the buyer greater control over the vessel, ocean freight, and insurance. CFR allows the seller to arrange freight while the buyer manages insurance. CIF adds seller-arranged marine insurance, although the risk generally still transfers when the coal is loaded on board at the Indonesian port of shipment.

The most accurate Indonesian steam coal quotation begins with a complete inquiry.

Buyers should provide the exact GAR, full quality specification, quantity, named loading or destination port, shipment schedule, inspection requirements, payment method, and preferred Incoterm.

A detailed RFQ allows the Indonesian coal supplier to evaluate mine availability, stockpile condition, logistics, vessel requirements, documentation, and commercial feasibility before issuing a formal offer.

Indonesia Export Center
WhatsApp: +62 813-3302-277
Email: info@indonesiaexportcenter.com

References

International Chamber of Commerce — Incoterms® 2020 guidance for FOB, CFR, and CIF.
International Chamber of Commerce — Incoterms® 2020 insurance requirements.
International Trade Administration — recognized Incoterms® for maritime transportation.
International Maritime Organization — International Maritime Solid Bulk Cargoes Code.
Indonesia Export Center — Indonesian steam coal product and quotation requirements.

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