Australia-listed South32 has lowered its fiscal 2016-2017 (July-June) coal production guidance for its South African thermal coal assets with export volumes taking the hit.
Export sales and pit development at the Wolvekrans Middelburg Complex were impacted by heavy rainfall in the January-March quarter and total fiscal 2016-2017 production guidance has been reduced to 30 million mt from 30.9 million mt, the miner said Thursday.
Despite the cut in guidance, the miner's expectation for coal being delivered into the domestic market has risen to 17.5 million mt from 17 million mt, while export coal has fallen to 12.5 million mt from 13.9 million mt.
"The depletion of existing pits and the delayed development of new mining areas at the WMC is expected to result in a further 2.5 million mt reduction in production in FY 2018 to approximately 27.5 million mt (domestic coal 16 million mt, export coal 11.5 million mt)," the company added.
Total thermal coal production from its South African mines stood at 6.68 million mt in the January-March period, down by 13% year on year and 6% from the October-December quarter, it said.
Export sales in the March quarter were 2.87 million mt, down 20% year on year and 3% quarter on quarter, while domestic sales stood at 4.06 million mt, up by 1% from the March 2016 quarter, and down 9% from October-December.
South32's Australian Illawarra metallurgical coal operation's guidance was left unchanged at 7.9 million mt but "requires a strong finish to the year," it said.
Total coal production from its Illawarra operation was 1.61 million mt, down 14% year on year and 12% quarter on quarter.
Of this, metallurgical coal production was at 1.43 million mt, down 13% year on year but up 3% quarter on quarter, and thermal coal production at 183,000 mt, falling 23% year on year and 58% quarter on quarter, it said.
