Australian coal export recovery to take weeks
It is likely to take weeks to clear the backlog to Australian coal exports caused by the storms that flooded mines through the Hunter valley, according to coal mining firms in the region.
Mines in the key Hunter valley region of New South Wales (NSW) are waterlogged after heavy rainfall caused the evacuation of parts of the region earlier this week. Staff are returning to work after many were cut off by flooded roads or evacuated from flooded homes. But it will take a couple of weeks before mine operators can fully assess the damage.
Before last week mines in the Hunter valley were operating as normal, albeit with water storage at or near full capacity. But the flooding this week has filled pits that will take time to empty. The port and rail infrastructure will recover more quickly. But coal stocks are reasonably low as the port has been pushing to try to cut the above average vessel queues waiting to load in the middle of one of the wettest Australian summers on record.
Mines outside the Hunter valley that deliver coal to Newcastle, including Yancoal's 20mn t/yr Moolarben mine, Glencore's 10mn t/yr Ulan mine and Whitehaven's operations in the Gunnedah basin, have received less rain and are not as saturated as those in the middle of the valley.
Hunter Valley mines include BHP's 20mn t/yr Mount Arthur mine, the 12.5mn t/yr Hunter Valley Operations joint venture between Yancoal and Glencore, Yancoal's 18mn t/yr Mount Thorley Warkworth complex, Glencore's 7.5mn t/yr Mount Owen and the 10mn t/yr United Wambo joint venture between Glencore and Peabody.
The Illawarra region of NSW was also flooded, with Port Kembla coal terminal (PKCT) declaring force majeure on 8 March on coal exports because of the slumping of its stockpile. But the recovery is expected to be quicker. PKCT is operating today and South32, which operates the Appin and Dendrobium mines in the area, expects to return to normal quickly.
Thermal coal prices have increased to record highs on increased interest from European buyers. Argus last assessed the high-grade 6,000 kcal/kg NAR thermal coal price at $377.27/t fob Newcastle on 4 March, up from $246.45/t on 4 February and from $192.60/t on 7 January.
Argus last assessed the semi-soft mid-volatile coking coal price at a record $518.40/t fob Australia on 9 March, up from $273.35/t on 4 February and from $225/t on 12 January.
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