By Rhiannon Hoyle
Australian miner New Hope on Monday reported a 32% on quarter increase in saleable coal production for its fiscal third quarter, underpinned by a lower strip ratio at the Bengalla coal mine in New South Wales state. Here are some remarks from its quarterly activities report.
On China sales:
“With import restrictions on Australian coal into China being lifted and the spread between 6000 and 5500 kcal/kg NAR products narrowing, we have refreshed our relationships into the Chinese market and completed our first sales which will be delivered in the next quarter. The robust demand from China of lower energy product has provided an outlet for a portion of our coal over the low season.
Imports in key markets are expected to increase in the coming months, with continued tight global supply expected to provide support to pricing for higher CV coal. The outlook for the remainder of calendar year 2023 remains positive, with market forwards continuing to show a contango.”
On prices:
“The gC NEWC index average price for the quarter was US$191.8, a 38.5% decrease compared to the same quarter last year of US$311.7, and a decrease of 48.1% from the previous quarter due to mild winter conditions in the Northern hemisphere and customers holding above average coal inventories. Market pricing stabilized in the quarter and high energy coals saw some gains in April, finishing with an average monthly gC NEWC price of US$189.7. The Japan Reference Price was agreed for Newcastle 6,322 kcal/kg GAR at US$199.9 for thermal coal on benchmark pricing from 1 April 2023.”
On the Bengalla mine:
“Following the dragline shutdown in December 2022, the dragline has been performing strongly and is ahead of the mine schedule. A dry weather outlook coupled with early delivery of the additional fleet acquired for the growth project will support Bengalla in reducing the prime waste deficit caused by severe wet weather events in 2021 and 2022. The operation is on track for a strong second half of financial year 2023 as represented by the improvement in volumes this quarter.
ROM coal production was 2.6mt [million metric tons], an increase of 26.8% due to a lower strip ratio of 3.8, compared to 5.5 in the January quarter. Increased throughput of crushed coal and feed into the CHPP [coal handling and preparation plant] have contributed to saleable coal production of 2.0mt, an increase of 31.7% to the previous quarter. This is in line with coal sold in the quarter of 2.1mt, an increase 46.7% to the previous quarter. There were no purchased coal sales during the quarter.
With the improvements in volumes and forecast dry weather conditions for the remainder of the 2023 financial year, operational cash costs (excluding delivery costs and royalties) have reduced from what was reported in our half year results presentation. Bengalla continues to work on productivity improvements to ensure it remains one of the lowest cost operations in the global seaborne thermal coal market.”
Write to Rhiannon Hoyle at [email protected]
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