Analysis: Key US Metallurgical Coal Mines See Production Recovery in Quarter 1
By Hector Forster and Jonathan Loades-Carter
April 20, 2018 - Several US low-vol and mid-vol coking coal mines produced at higher rates in the first quarter during a period of rising export and domestic prices, US government data analysed Friday by S&P Global Platts showed.
Higher output may help alleviate concerns around supplies on global demand for alternatives to coals from cyclone-prone Australia.
The increase in output comes after reports that in Central Appalachia coal was piling up at mines and prep plants, due to patchy rail and port performance since December.
Depending on how logistics improve and mining rates may be maintained, supply tightness in the Atlantic Basin may be further abated as Australian offers rise. US high-vol A has commanded a premium over top-tier Australian coking coal indices since mid-March.
Large export-orientated US coking coal mines such as Buchanan, Pinnacle, Leer, Shoal Creek and Oak Grove gave a mix of higher rates based on Q1 2017 levels, or quarter-on-quarter improvements since Q4, according to US Mine Safety and Health Administration data.
At Coronado Coal's Buchanan mine, output close to mine capacity of 1.37 million st in Q1 was near the record output seem in first half 2017.
Output since had slowed, to 1.28 million st in Q4. In Q1 2017, Buchanan produced 1.46 million st.
Mission Coal's low-vol mines of Pinnacle and Oak Grove improved rates in Q1. Pinnacle produced 365,444 st in Q1, up from 271,824 st in Q1 2017, and slightly improving on the 359,025 st in Q4.
Alabama premium coal mine Oak Grove had 427,901 st reported for Q1, down from 447,657 st a year ago, but up from Q4's 361,329 st. Mission Coal worked to recover from mining production difficulties at the mine, and targeted improvements at the facility to raise output in 2018.
At the Maple Eagle high-vol A mine also operated by closely held Mission Coal, no production in Q1 was reported by MSHA, with Q4's stated at 174,342 st.
At Drummond Co.'s Shoal Creek premium mid-vol mine in Alabama, output rebounded to 744,143 st in Q1,the highest quarterly total since Q4 2016, based on MSHA data. Output in Q1 2017 was 694,578 st and Q4 was 478,719 st.
Also in Alabama, output at Warrior Met Coal's No.7 and No.4 low-vol and mid-vol mines for Q1 were not yet available, based on MSHA data.
At Arch Coal's Beckley low-vol mine, output was 242,173 st in Q1, compared with 264, 079 st in Q1 2017 and 255,340 st in Q4. At Arch's larger Leer mine, which produces high-vol A using longwalls, Q1 output rose to 939,125 st, from 829,896 st in Q1 2017. The mine produced 795,841 st in Q4.
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