Coal miner South32, which has mines in Australia and South Africa, saw its coal production fall year on year in the October-December quarter, by 6.78% to 8.91 million mt, from 9.56 million mt, data from the company's quarterly report showed Thursday.
It was also down by 7.46% from the July-September quarter, which totalled 9.63 million mt, the data said.
The miner's total thermal coal production across the two countries during the period was 7.52 million mt, which was down 9.85% year on year and 8.22% quarter on quarter, the report showed.
In South Africa, South32 produced 7.08 million mt in the December quarter, which was a decrease of 12% year on year and 9% from July-September, it said.
The company's domestic sales of the fuel in South Africa fell by 7% year on year to 4.47 million mt, but rose 1% from the previous quarter. And exports fell by 24% year on year and rose 2% from the previous quarter to 2.95 million mt in October-December.
"South Africa Energy Coal saleable production decreased by 9% (or 1.6 million mt) to 14.8 million mt in the December 2016 half year," South32 said.
"The decline in production reflects the prior closure of the North Plant at the Wolvekrans-Middelburg Complex (WMC), scheduled maintenance and the repositioning of draglines. Export sales were also impacted by Transnet's annual rail maintenance cycle," it said.
Fiscal 2016-2017 (July-June) saleable coal production guidance for its South African assets remains unchanged at 30.9 million mt, with 17 million mt expected to go into the domestic market and 13.9 million mt for exports, it said.
In Australia, the miner's total coal production rose 24.34% year on year but fell 2.92% quarter on quarter to 1.83 million mt in October-December, the figures showed.
South32 owns Illawarra Metallurgical Coal which operates two underground mines near Wollongong in New South Wales. The coal is trucked to Port Kembla for distribution to domestic and international customers.
Metallurgical coal production at the project rose 14.19% year on year, but fell 3.13% from July-September to 1.39 million mt in October-December, it said.
And, its Australian thermal coal production stood at 437,000 mt in the three-month period, which was up 73.41% year on year but down 2.24% quarter on quarter, it said.
For July-December, Illawarra Metallurgical Coal saleable production decreased by 6% to 3.7 million mt, the company said.
"The decline in production primarily reflected challenging ground conditions at Appin Area 9 and a moderation in mining rates at Appin Area 7 that ensured gas concentrations were maintained at safe levels," it said.
"These impacts were partially offset by strong operating performance at Dendrobium," it said.
South32 said it is maintaining its production guidance of 7.9 million mt and sales guidance of 8.1 million mt for fiscal 2016-2017 at Illawarra Metallurgical Coal after lowering them in December. Prior to that it had been expecting production of 9 million mt and sales of 9.3 million mt.
"As a result of a carry-over shipment in December 2016 associated with the production challenges at Appin and our declaration of force majeure, our average realized price for metallurgical coal in the December 2016 half year will reflect a modest discount to the premium low-volatile hard coking coal index on a volume weighted M-1 basis," it said.
M-1, or month minus one, is the quarterly sales volume weighted average of the premium low-volatile hard coking coal Platts index (FOB Australia) on the basis of a one month lag to published pricing. It was $156/mt in the December 2016 half year.
