Coal news and updates

Yancoal Australia cuts 2022 coal output view as floods, COVID bite

Coal miner Yancoal Australia Ltd YAL.AX cut its 2022 output forecast on Wednesday, signalling a hit from higher-than-expected rainfall, COVID-19-led labour shortages and cost pressures.

This month, torrential rain has pounded New South Wales (NSW) state, where several of Yancoal’s key projects are, forcing thousands of people to evacuate and leaving mining operations in limbo.

It comes at a time when inflation around the world is surging in the aftermath of the Russia-Ukraine crisis and as the company said it needs to revise a longwall mining sequence at its Moolarben project in NSW to preserve an Aboriginal heritage site.

Yancoal, which is subject to a potential takeover by China’s Yankuang Energy 600188.SS, 1171.HK, said it now expects 31-33 million tonnes (Mt) of attributable saleable coal production for the full year, down from an earlier forecast of 35-38 Mt.

It produced 15.5 Mt of attributable saleable coal in the first half, 11% lower than a year earlier.

Still, Yancoal and its peers stand to benefit from supercharged prices of coal due to sanctions on Russia after its invasion of Ukraine and as buyers in Europe look for alternate sources of the commodity.

The company said its average realised price in the first half was $314 per tonne, more than thrice the $94 per tonne it booked a year earlier. Peer Whitehaven Coal WHC.AX on Monday forecast record core earnings for the coming year.
Source: Reuters (Reporting by Shashwat Awasthi; Editing by Amy Caren Daniel)