Indonesian thermal coal miner Indo Tambangraya Megah said late Wednesday that its production and sales over January-September fell to 19 million mt and 20.1 million mt respectively.
It also cut its output target for 2016, citing weather disruptions.
Over January-September 2015, ITM produced 21.5 million mt of thermal coal and sold 20.9 million mt.
Average selling price over January-September slumped 18% to $47.50/mt from $57.70/mt a year ago.
However, in the July-September quarter, the average selling price rose 12% to $49.90/mt from $44.70/mt in April-June.
Thermal coal prices have surged in the latter half of the year, driven mainly by Chinese demand and supply tightness in various producing regions.
"The thermal coal market continued to remain tight in Q3, driven by lower domestic supply in China and wet season in Indonesia," ITM said in its latest quarterly report. "We believe coal price is continuing to increase during this last quarter of 2016."
Higher-than-expected rainfall impacted production, the company said, adding that production was now targeted at 26.2 million mt and sales were expected to be about 27.1 million mt for the full year.
"The Q3 rainfall levels at most mines reached highest levels in six years, with September's level up steeply," the company said in its analyst briefing on the quarterly performance.
In its half-yearly report, ITM had said that it was targeting production of 26.6 million mt and sales of 27.7 million mt for the full year.
Citi analysts said earlier this week that rain continued to disrupt production in Indonesia and some have forecast abnormally wet weather into January or February next year.
ITM, which counts China, Japan, Indonesia and India among its major buyers, said 99% of its target sales volume for 2016 had been sold.
The company operates six mining concessions in East, South and Central Kalimantan provinces, producing coal with heating value ranging from 4,400 to 6,300 kcal/kg gross as received, according to the company's website.
The price of FOB Kalimantan 5,900 kcal/kg GAR has more than doubled since the start of the year to be assessed Wednesday at $94.50/mt, according to S&P Global Platts data.
"The positive impact of higher coal prices is expected to be realized in the fourth quarter performance," ITM said.
"Our production costs have been reduced by 31% since the [cost-reduction] program was tightly applied in 2013," it added.
