Coal sales at Australia’s Whitehaven fall in Jan-Mar

  • Market: Coal, Coking coal, Metals
  • 19/04/24

Australian coal miner Whitehaven reported higher production but lower sales in January-March, with the firm increasing its percentage of high-grade thermal coal sales from the previous quarter.

Saleable coal volumes rose by 8pc on the year to 3.9mn t but managed coal sales fell by 7pc to 3.8mn t compared to a year earlier. Sales were 83pc high-grade thermal, higher than 72pc in October-December and 68pc a year earlier.

Whitehaven said run-of-mine production at Narrabri was below expectations because of the current panel's geological challenges, leading to reliability and maintenance problems with equipment.

Whitehaven's overall sales guidance for the 2023-24 fiscal year remains unchanged at 16mn-17.5mn t for 2023-24 with a unit cost guidance, excluding royalties, of A$103-113/t ($66-$72/t) which the firm said is tracking at the top end. This is because of lower output from Narrabri, which is tracking below its output guidance of 5.1mn-5.7mn t for the fiscal year to 30 June.

Whitehaven finalised takeovers of Australian-Japanese joint venture BHP Mitsubishi Alliance's (BMA) 12mn t/yr Blackwater and 4mn t/yr Daunia coking and thermal coal mine in Queensland on 2 April, with initial sales and production data to be reported in its April-June production report.

The two mines are anticipated to deliver 4.5mn-5mn t run-of-mine output in April-June, with Whitehaven's revenue breakdown to be 70pc metallurgical and 30pc thermal on an annual basis post-acquisition as it seeks to pivot toward coking coal.

Blackwater and Daunia contributed 10.11mn t and 4mn t respectively to BMA's total output in 2023. Whitehaven plans to sell down a 20pc stake in Blackwater to global steel producers, with a process presently underway.

Whitehaven views the high calorific value (CV) thermal coal market as well supported in its key Asian markets, and said tightening of sanctions on Russian exporters is containing global supply.

India's continuing growth is driving demand and underpinning price sentiment, Whitehaven said, despite a softening in metallurgical coal prices during the quarter .

The Argus high-grade 6,000 kcal/kg NAR price averaged $126.74/t fob Newcastle and the 5,500 kcal/kg NAR coal price $93.85/t during January-March, compared with $134.23/t and $96.80/t respectively for October-December.

Whitehaven quarterly results
Jan-Mar '24Oct-Dec '23Jan-Mar '23
Volumes (mn t)
Managed coal production3.94.23.6
Managed coal sales3.84.74.1
Managed coal stocks at period end11.51.5
Coal sales mix (%)
High-grade thermal coal837268
Other thermal coal81926
Metallurgical coal996
Prices achieved ($/t)136142280
Thermal coal136142280
Metallurgical coal213166234

Australian coal price comparisons ($/t)

Sharelinkedin-sharetwitter-sharefacebook-shareemail-share

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

News
20/05/24

India's JSW Steel to buy coking coal firm in Mozambique

India's JSW Steel to buy coking coal firm in Mozambique

Singapore, 20 May (Argus) — India's JSW Steel will buy a coking coal company in Mozambique to secure supply of the key steelmaking raw material and shield against any volatility in prices. JSW Steel's board of directors approved the acquisition of coal mining firm Minas de Revuboe (MDR) for about $74mn. The purchase of a 92pc stake in MDR gives JSW access to more than 800mn t of premium hard coking coal reserves in Mozambique, the steel producer said on 17 May. MDR's mine is not yet operational but the company aims to start developing the mine in the 2024-25 fiscal year. "This is not only going to provide us some cushioning with respect to the highly volatile [premium low-volatile (PLV)] index," said JSW Steel's chief executive officer Jayant Acharya. "It also is logistically closer to India, and therefore, will give us an optimised cost." Fluctuations in prices of high-quality seaborne coking coal have been a concern for Indian steelmakers, as they work to ramp up production in anticipation of rising demand from the infrastructure and automobile sectors. The Argus -assessed Australian PLV hard coking coal price crossed $600/t in March 2022, following the start of the Russia-Ukraine conflict. It was at $237/t on 17 May, a decline of $8/t from the start of this month, owing to ample supplies and thin buying interest. JSW Steel's fourth-quarter profit fell by 64pc to 12.99bn rupees ($156mn) because of higher coking coal costs. Crude steel production in the quarter rose by 3pc on the year to 6.79mn t, while sales totalled 6.73mn t, also registering a growth of 3pc from last year. The company also expects capital expenditure at 200bn rupees ($2.4bln) in the 2024-25 fiscal year, as it adds to its steelmaking capacity. JSW Steel is targeting a production capacity of 50mn t/yr by the 2030-31 fiscal year. The company expects steel demand to pick up in the coming year, citing the government's infrastructure push and robust economic growth in India. By Amruta Khandekar Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Find out more
News

India to launch policy to boost critical mineral supply


20/05/24
News
20/05/24

India to launch policy to boost critical mineral supply

Mumbai, 20 May (Argus) — India is working on a critical mineral policy to boost domestic supplies, and plans to collaborate with resource-rich countries in critical minerals mining and processing. The mines ministry and related government institutes like the Geological Survey of India (GSI) are working on a policy to drive domestic exploration and processing of critical minerals, a source close to the development told Argus . Discussions are currently progressing, the source added without providing details on the timeline. India is looking into all aspects to boost domestic production of critical minerals, the source said. India is also seeking critical mineral supplies from overseas to feed burgeoning demand from the green energy and electric vehicle (EV) industries. The Indian government is in talks with several countries including Chile, Australia, and some African countries, over opportunities for mining and technology collaboration for lithium processing and other critical minerals. Critical minerals like copper, lithium, nickel, cobalt and rare earths are important for the development of clean energy technologies, including wind turbines, solar panels, electric vehicles and battery storage. It is crucial for India, which currently relies heavily on imports of lithium-ion cells from China, Japan and South Korea, to develop a robust battery supply chain to meet its ambitious target of 30pc EV penetration by 2030. India is currently conducting feasibility tests on five projects of lithium and cobalt in Australia , said Ministry of Mines' secretary VL Kantha Rao at Khanij Bidesh India (Kabil)'s office opening ceremony on 11 May. Kabil, a joint venture between state-run Nalco and Hindustan Copper and Mineral Exploration, was formed to explore and produce strategically important minerals overseas. The firm in January signed an agreement with Argentinian state mining company Catamarca Minera y Energetica Sociedad del Estado (Caymen) to explore five lithium brine blocks in the Catamarca province of Argentina. India's mines ministry and Rao held several meetings over the past two months with the Chilean government and Chilean state-owned firms such as Empresa Nacional de Mineria and Codelco on critical minerals opportunities. India has also spoken with deputy minister of mining and heavy industry of Mongolia, Uyanga Bold, on co-operation in the critical mineral sector. By Samil Surendran Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Japan’s FEPC calls for clearer nuclear policy stance


20/05/24
News
20/05/24

Japan’s FEPC calls for clearer nuclear policy stance

Osaka, 20 May (Argus) — Japan's Federation of Electric Power Companies (FEPC) has called for a clarification of the country's nuclear power policy, to ensure stable electricity supply and alignment with its net zero emissions goal. The call comes as the government reviews its basic energy policy , which was formulated in 2021 and calls for the reduction of dependence on nuclear reactors as much as possible. But Japan's guidelines for green transformation, which was agreed in February 2023, states that Japan should make the most of existing nuclear reactors. Tokyo should clearly state in its new energy policy that it is necessary to not only restart existing nuclear reactors, but also build new reactors, said FEPC chairman Kingo Hayashi on 17 May. Hayashi is also the president of utility Chubu Electric Power. Hayashi emphasised that to utilise reactors, it would be necessary to have discussions regarding financial support, policy measures that would help ensure cost recovery, address back-end issues in the nuclear fuel cycle and conduct a review of nuclear damage compensation law. Japan's current basic energy policy is targeted for the April 2030-March 2031 fiscal year, when the country's greenhouse gas (GHG) emissions is forecast to fall by 46pc from 2013-14 levels. To achieve this, the power mix in the policy set the nuclear ratio at 20-22pc, as well as 36-38pc from renewables, 41pc from thermal fuels and 1pc from hydrogen and ammonia. Japan typically reviews the country's basic energy policy every three years. Nuclear, as well as renewables, would be necessary to reduce Japan's GHG emissions, although thermal power units would still play a key role in addressing power shortages. But Japan has faced challenges in restarting the country's reactors following safety concerns after the 2011 Fukushima nuclear disaster, with only 12 reactors currently operational. Japan's nuclear generation in 2023 totalled 77TWh, which accounted for just 9pc of total power output. Tokyo has made efforts to promote the use of reactors, after the current basic energy policy was introduced in 2021. The trade and industry ministry (Meti) has updated its nuclear policy, by allowing nuclear power operators to continue using reactors beyond their maximum lifespan of 60 years by excluding a safety scrutiny period in the wake of the 2011 Fukushima nuclear disaster. This could advance the discussion on Japan's nuclear stance, especially if the new basic energy policy includes more supportive regulations. The trade and industry ministry started discussions to review the energy policy on 15 May, aiming to revise it by the end of this fiscal year. It is still unclear what year it is targeting and what ratio will be set for each power source in the new policy. But the deliberation would form a key part of efforts to update the GHG emissions reduction goal, ahead of the submission of the country's new nationally determined contribution in 2025, with a timeframe for implementation until 2035. By Motoko Hasegawa Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Trade curbs spur Chinese battery firms to look overseas


17/05/24
News
17/05/24

Trade curbs spur Chinese battery firms to look overseas

Beijing, 17 May (Argus) — An increasing number of Chinese battery firms have accelerated their expansions outside China, to meet buoyant overseas demand and to tackle escalating geopolitical curbs. These curbs include the US' newly announced tariff hikes on China's electric vehicles (EVs) and batteries from 2024 or 2026, and the EU's potential punitive duties on battery EVs originating from China. The US' Inflation Reduction Act (IRA) and the EU's Critical Raw Material Act have also prompted many Chinese battery material producers to step up their overseas expansions. China's battery material manufacturer Hunan Zhongke Electric has unveiled a plan to invest no more than 5bn yuan ($692mn) to build a production plant for battery anode material in Morocco, in which some other Chinese firms have also invested in similar projects. The plant has a designed capacity of 100,000 t/yr and will be developed in two phases with 50,000 t/yr each. The firm aims to complete plant construction for each phase in 24 months. Zhongke is a major battery anode material producer in China with 210,000 t/yr of capacity as of the end of 2023. Its output of anode materials rose to 143,513t in 2023, up by 14pc from 125,460t a year earlier, driven by the country's rising EV sales. It aims to expand overseas sales in the coming years. Major Chinese copper producer Zhejiang Hailiang also outlined a plan to build a 25,000 t/yr production plant for copper foil used in lithium-ion batteries in Morocco. Construction will take 36 months. "The layout of the Morocco project can help us penetrate into the European and US markets as soon as possible as exports from Morocco are duty free to these markets," Hailiang said. "This will help us avoid any international trade barrier." Morocco is one of the main destinations for Chinese companies to invest in and build overseas battery component plants given its abundant resources for phosphate, a main chemical compound in a lithium iron phosphate battery, and its free trade agreement (FTA) with the US. It is also a major cobalt metal producing country outside China, with cobalt being a critical mineral used in the manufacturing of lithium-ion batteries. Major Chinese battery material producer EVE Energy is on track to develop a production project for energy storage batteries in Malaysia. It will establish a subsidiary EVE Energy Malaysia Energy Storage to develop this project to meet Malaysia's energy storage battery demand, although it has not disclosed the capacity, construction schedules and launch dates. The plant is the second phase of EVE's new energy products development in Malaysia. It in August 2023 started building a plant for cylindrical batteries mainly used in electric two-wheelers and electric tools in the southeast Asian country. The firm said the US' new tariff hikes will not affect its business because it had planned the Malaysia projects for consumer batteries and energy storage in advance, and these projects will support shipments to US consumers by 2026. New US tariff hikes US president Joe Biden's administration announced on 14 May that the tariff on lithium-ion EV batteries will immediately increase to 25pc, while the tariff on all other lithium-ion batteries is set to increase to 25pc in 2026, both from the current rate of 7.5pc. This is likely to trigger more Chinese battery companies to increase their overseas investments to avoid the tax, according to industry participants. The US' tariff hikes have drawn strong criticism from China. "Politicising and instrumenting economic and trade issues is typical political manipulation," said the country's ministry of commerce. "The Section 301 tariff hikes goes against President Biden's promise of 'not seeking to contain China's development' or 'not seeking to break the chain of decoupling from China'. The US should immediately correct its wrongful actions and cancel the tariffs. China will take 'resolute" measures to safeguard its own rights and interests'." Chinese battery firms' investments in Morocco Company Products Capacity Launch dates CNGR CAM precursors, LFP, black mass 120,000 t/yr, 60,000 t/yr, 30,000 t/yr 4Q, 2024 BTR CAM 50,000 t/yr N/A Hunan Zhongke Anode material 100,000 t/yr in 24 months Huayou Cobalt/LG LFP 50,000 t/yr in 2026 Huayou Cobalt/LG Lithium salts 52,000 t/yr N/A Sichuan Yahua/LG Lithium hydroxide N/A N/A Hailiang Li-ion battery copper foil 25,000 t/yr in 36 months Source: Company releases Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

US inflation slows broadly in April


15/05/24
News
15/05/24

US inflation slows broadly in April

Houston, 15 May (Argus) — US consumer price gains eased in April, with core inflation posting the smallest gain in three years, signs the economy is slowing in the face of high borrowing costs. The consumer price index (CPI) rose by an annual 3.4pc in April, easing from 3.5pc over the prior 12-month period, the Labor Department reported on Wednesday. Core CPI, which strips out volatile food and energy, rose by 3.6pc, slowing from 3.8pc the prior month. The easing inflation comes as the Federal Reserve has pushed back the expected start of interest rate cuts after holding its target rate at a 23-year high since July 2023 as the US economy has continued to grow and generate jobs at greater than expected rates. Job growth however slowed to 175,000 in April, the lowest since October 2023, and job openings and wage gains have also slowed while a measure of manufacturing has contracted. The CME FedWatch tool boosted the probability of Fed rate cuts in September to about 72pc today from about 65pc on Tuesday. The energy index rose by 2.6pc over the 12 months ended in April, accelerating from 2.1pc. The gasoline index slowed to an annual 1.2pc in April from 1.3pc The food index rose by an annual 2.2pc, matching the prior month. Shelter slowed to 5.5pc from 5.7pc. Services less energy services slowed to 5.3pc from 5.4pc. Transportation services accelerated to an annual 11.2pc, led by insurance costs, from 10.7pc in the 12 months through March. On a monthly basis, CPI inflation slowed to 0.3pc in April from 0.4pc the prior two months. Core inflation slowed to 0.3pc from 0.4pc the prior three months. Energy held flat at a monthly 1.1pc. Services less energy services slowed to a monthly 0.4pc gain from 0.5pc. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more