The diversified miner's South African subsidiary Duiker Mining will defer the planned restart of the coal re-treatment process at its Waterpan colliery and close certain production sections to reduce higher cost production and better manage stockpiles at its mines and the Richards Bay Coal Terminal.
"Including the five day closure of Duiker operations over the Easter break, the net impact of these moves will be to reduce output of export coal by around 400,000 tonnes this quarter," Xstrata said.
Australian subsidiary Enex Resources will reduce output of export coal by a similar 400,000 tonnes this quarter and lower overhead costs by decreasing the number of contractors and the amount of overtime work at a number of operating units, as well as by increased holiday closures at contract-run operations.
"We have made the decision to reduce output to address the current oversupply in the market and avoid the further build-up of stockpiles," Xstrata Coal chief executive Peter Coates said.
"The measures we are implementing in both Australia and South Africa will help us reduce overheads or cut back on higher cost production, while matching output more closely with demand going forward.
"We believe this is a positive move, which shows that the days of uncontrolled supply into the market are well and truly behind us."
About 100 jobs will be shed in at the South African, but Coates was confident that would be achieved through voluntary separation and natural attrition.
"There will be no loss of full-time jobs in Australia," he said.
