Fording said it unsuccessfully tendered for a large metallurgical coal sales contract with Turkey after selling around 800,000 tonnes into the market in the year to June.

Also hitting its sales, other customers buying coal under contract are taking less than expected.

The company said metallurgical coal sales for the third quarter are expected to be 3Mt, or 9.3Mt for the year to date, and the anticipated full-year sales of 13Mt are now 98% under contract.

"It has proven to be challenging for us to secure the sales volumes we had expected this year," Fording president and chief executive Jim Gardiner said.

"Going forward, we will manage our production in light of the current circumstances and ongoing conditions."

The company also lowered its anticipated sales price to C$62-63 a tonne from C$64/t due to the expected lower sales volume and its "significant" foreign currency hedge position in 2002.