Australia’s South32 says Q1 met coal output drops 15%, sees prices rising
Australian diversified miner South32 Ltd S32.AX said on Thursday higher metallurgical coal prices would help offset a 15% drop in first-quarter production of the steelmaking material.
A power crunch, environmental curbs and a debt crisis gripping China’s property market has clouded the outlook for the steelmaking material, sending prices higher. However, supply outside China has so far remained inelastic to the sharp price increases.
“While the lower total volumes are expected to adversely impact Operating unit costs, realised prices will benefit due to
fewer sales of the lower-priced product and the current strong metallurgical coal market,” the company said.
Production of metallurgical coal fell to 1.6 million tonnes (Mt) in the three months to Sept. 30 from 1.9 Mt a year earlier, missing RBC’s estimate of 1.7 Mt.
Metallurgical coal sales, however, rose 1% to 1.5 Mt.
The world’s largest producer of manganese ore said quarterly output of the commodity rose about 7% to 1.6 million wet metric tonnes (wMt), compared to RBC’s estimate of 1.4 wMt.
Source: Reuters (Reporting by Tejaswi Marthi and Riya Sharma in Bengaluru; Editing by Maju Samuel)