New South Wales Energy Coal production decreased 11% to 7 million tonnes for the six months to December.
A change in product strategy to focus on higher quality products also affected production.
"We are monitoring the situation and if air quality continues to deteriorate then operations could be constrained further in the second half of the year," the company said.
At this stage guidance for the 2020 financial year remains unchanged at between 15 and 17Mt.
BHP increased metallurgical coal production 17% in the December quarter to 11Mt following the completion of significant planned wash plant maintenance activities in the prior quarter.
Guidance for the 2020 financial year remains unchanged at between 41Mt and 45Mt, with a stronger second half performance expected in line with BHP's plans.
At Queensland Coal, strong underlying operational performance at Poitrel, Peak Downs, Caval Ridge and Broadmeadow was offset by planned major wash plant shutdowns at Goonyella, Peak Downs and Caval Ridge, low opening raw coal inventories at Blackwater, and truck and shovel underperformance at South Walker Creek.