Coronado's US operations 'take advantage' of China ban on Aussie coal

CORONADO Global Resources’ US operations have profited from the Chinese import restrictions placed upon Australian coal producers in the six months to June 2021 its results show.
Coronado's US operations 'take advantage' of China ban on Aussie coal Coronado's US operations 'take advantage' of China ban on Aussie coal Coronado's US operations 'take advantage' of China ban on Aussie coal Coronado's US operations 'take advantage' of China ban on Aussie coal Coronado's US operations 'take advantage' of China ban on Aussie coal

Coronado's Curragh mine in Queensland.

Coronado said the during first half of 2021 it was impacted by a distorted metallurgical coal market driven by the import restrictions on Australian coal by China, seasonal wet weather conditions and higher foreign exchange rates.

There were also operational and logistics delays at its Curragh open cut mine in Queensland.

"[This was] mitigated in part by strong production at the company's US operations, which have returned to pre-COVID levels," it said.

"As a global supplier of metallurgical coal, Coronado's geographical diversification has helped withstand the negative impact from lower benchmark pricing and the Chinese import restrictions on Australian coal.

"Our US operations have successfully taken advantage by increasing sales volumes directly into China year to date."

On June 28 2021, Coronado achieved a record for the largest shipment of High Vol A coal from a US East Coast port in a single cargo.

Coronado loaded 136,400 tonnes of coal from its Logan mine in the US on the Frontier Unity cape vessel bound for China.

Coronado CEO Gerry Spindler said the Coronado team had "responded admirably to the challenges and market conditions presented in the first half of 2021".

"For most of the half, Coronado navigated a difficult price environment as global coal markets remained disjointed due to the COVID-19 pandemic and Chinese import restrictions on Australian sourced coal," he said.

"By the end of the half, the imbalance in coal markets had largely resolved itself with pricing significantly increasing and index parity between the US and Australian markets resuming."

Coronado's half yearly revenue came to US$800.4 million, which was up 12.1% due to higher sales volumes and the recent improvement in metallurgical coal pricing from late May, consistent with high global demand for steel.

Mining costs per tonne sold was $64.20, which was up 12% while operating cost per tonne sold of $85.80 was up 7.7%.

"As we look to the second half of 2021, we are buoyed by the prospect of prolonged higher metallurgical coal prices as steel demand continues to rise faster than supply growth driven by ongoing robust industrial output," Spindler said.

"Coronado is well positioned to improve production rates and lower costs in the second half of the year, allowing us to take advantage of the higher prices and to continue our trajectory of increasing liquidity and reducing net debt."