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Vale 2013 coal production jumps 24% on-year to 9 mt, misses annual target

Global diversified miner Vale produced 8.8 million mt of coal in 2013, rising 23.7% on the year, although missed its yearly target of 12.4 million mt, it said Thursday in its production report for the fourth quarter and whole of 2013.

The yearly total was split between 1.9 million mt of thermal coal, slipping 6.1% from 2012, and 6.9 million mt of metallurgical coal, a 35.5% increase on the year.

The miner produced 2.3 million mt of coal during the fourth quarter of 2013, up 15.7% on the year, but slipping 5% from the previous quarter.

Quarterly production comprised 408,000 mt of thermal coal, which declined 15% from Q4-12 and 26.2 from the previous quarter.

The remaining 1.85 million mt consisted of met coal, which jumped 25.8% on-year and 1.5% from Q3-13.

Vale attributed the rise in yearly and annual production to strong output at Carborough Downs in Australia, which produced a record 2.5 million mt of met coal during the year, soaring 168.6% on-year and 76% higher than its previous record in 2011.

Integra Coal in Australia produced 1.4 million mt of semi-soft coking coal in 2013, rising 46.6% from 2012. However, the mine's thermal coal output fell 75.1% on the year to 87,000 mt, due to the priority placed on met coal production.

Vale said that the Integra operations were also adversely affected by longwall cutting mechanism problems and adverse weather conditions.

The miner's other Australian operations produced 347,000 mt of thermal coal during the year, down 9% from 2012, with met coal output also dropping 7.5% on-year to 656,000 mt.

Vale said that its annual target was missed due to the constrained ramp-up at Moatize in Mozambique, which produced 1.4 million mt of thermal coal during the year, climbing 14% from 2012, and 2.4 million mt of met coal, down 5.1% on the year.

"The ramp-up of the first phase of the Moatize coal project is being temporarily restricted by the existing limitations of the logistics infrastructure -- railway and port -- which do not allow for total utilization of the mine nominal capacity of 11 million mt/year," it said.

"The conclusion of the Nacala corridor project will eliminate the above mentioned logistics bottleneck," Vale added.

The miner also noted that Mozambique production volumes had also been impacted by the limited availability of explosives for blasting operations, although it expected explosive supplies to be fully restored.

Source: Platts