Glencore’s Rolleston stops coal production in Australia for two weeks
Glencore’s Rolleston coal mine in Queensland, Australia, has
stopped production for two weeks starting June 2, sources told S&P Global
Platts June 3. The coal mine was heard to be making losses at the prevailing
market price.
The move comes weeks before the upcoming 59-day closure of
Peabody’s Wambo underground thermal and semi-soft coking coal mine in New South
Wales, Australia, starting June 19 amid weaker demand, sources said.
The Wambo underground mine sold 2.2 million mt of coal in
2019, according to its company website. Sources said of the total coal sold in
2019, about 1.8 million mt was thermal coal.
After TerraCom cut its production guidance at Blair Athol
mine for 2020 and 2021, and Peabody’s Wambo mine’s upcoming closure, Glencore’s
Rolleston is the third mine with downward adjustment on production, sources
said.
Rolleston mainly produces 5,500 kcal/kg NAR Australian coal
targeted for China’s market, according to sources. The mine has an annual
production capacity of 13.94 million mt of run-of-mine thermal coal, its
company website showed.
Glencore declined to comment while Peabody was not available
for comments.
Elsewhere, New Hope’s Bengalla mine in New South Wales,
Australia, has planned for an upcoming maintenance which has been factored into
the production numbers of the year, New Hope’s spokesperson said June 2. “It is
a planned shutdown and has been staged to ensure no impact on the mine’s annual
production,” he added.
The mine has suffered from lower margins and higher
run-of-mine stock ever since the five major state-owned utilities were
reportedly warned by China’s National Development and Reform Commission (NDRC)
for fresh Australian coal purchase on May 15, sources said.
“They probably have no space for their run-of-mine stocks,”
a Singapore-based trader said.
Demand condition
Buyers in China complained about the increasing difficulties
to import Australian coal and muted trading activities while sellers noted a
dip in enquiries ever since May 15, sources said.
Platts assessed FOB Newcastle 5,500 kcal/kg NAR at $41.50/mt
FOB on June 2, down $3/mt as compared to May 15.
In Japan, despite the recent recovery from COVID-19, buyers
have no additional demand for coal due to lower power demand amid slow recovery
of heavy industries in Japan, several sources said.
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