Mining giant Glencore’s coal production stood at 48.7 million tonnes (mn t) in H1CY’21 against 58.1 mn t in H1CY’20. This drop in output is majorly attributed to:
- Prodeco mine being under care and maintenance in the entire H1 period.
- Reduced demand for Australian coal from China.
- Reduced export rail capacity in South Africa.
However, this drop in production was partly offset by the recovery at Cerrejon mine from its Covid-related restrictions in H1CY’20.
Production break-up:
Australian coking coal
Production was at 4.1 mn t, up by 11% against H1CY’20, mainly reflecting additional metallurgical-quality material from Collinsville.
Australian thermal and semi-soft coal
Production of 30.2 mn t, was 15% lower as compared to H1CY’20, mainly reflecting market-related supply reductions initiated in H2CY’20 following the Chinese ban on Australian coal imports.
South African thermal coal
Production of 10.8 mn t, was 12% lower compared to H1CY’20, mainly reflecting lower domestic production on account of weaker local demand conditions, and planned overall curtailments to match reduced export rail capacity.
Cerrejon
Attributable production of 3.6 mn t, which was 33% higher compared to H1CY’20, due to a Covid-related temporary suspension last year.
Surge in thermal coal prices
In H1CY’21, the S.African 6,000 NAR average price shot up by 53% y-o-y to $98/tonne (t) while the 6,000 NAR Australian thermal coal rose by 62% y-o-y to $99/t.
Lower production guidance
The company has revised its production guidance to 104 mn t (+/- 4 mn) for the entire year of 2021 from the earlier guidance of 113 mn t (+/- 4 mn t) reflecting reduced coal production volumes due to export rail constraints and weaker domestic demand in South Africa and reduced demand for Australian coal from China.
Leave a Reply