Anglo American says coal production fell in first quarter and reduces its full-year output guidance

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Anglo American PLC (LON:AAL) said its coal production fell in the first quarter and reduced its full-year output guidance for both metallurgical and thermal coal.


Thermal coal production dropped 20% from the year-earlier quarter to 4.9 million tonnes (Mt), with guidance for the year cut to about 14 Mt, from about 24 Mt, reflecting the diversified miner’s plans to spin off its thermal coal operations in South Africa.


READ: Anglo American to spin off thermal coal operations in South Africa


Overall, first-quarter production was at 95% of normal capacity, meeting strong customer demand despite some limited constraints at certain operations due to COVID-19, said the FTSE 100-listed miner.


“Production increased by 3% driven by strong performances at the copper operations in Chile, and PGMs and iron ore in South Africa, more than offsetting plant maintenance downtime at Minas-Rio iron ore in Brazil and the temporary suspension at the Moranbah metallurgical coal operation in Australia,” said chief executive Mark Cutifani.


The company was keen to flag up its green credentials.


“Anglo American’s portfolio is increasingly tilted towards future-enabling metals and minerals, with our recently proposed demerger of our thermal coal operations in South Africa moving us further in that direction,” said Cutifani.


“We are also making good progress in ensuring every operation plays its part towards a lower carbon world, with 100% renewable electricity supply now secured for all of our operations across Brazil, Chile and Peru.”


All South American operations will have 100% renewable electricity supply from 2022.


Metallurgical coal production fell 14% from the year-earlier period to 3.3 Mt, leading the company to reduce full-year guidance to 14-16 Mt from its previous target of 18-20 Mt.


Copper production increased 9% due to strong performances at both Los Bronces and Collahuasi with prices for its copper about 40% higher in the first quarter than during the average for the whole of 2020.


Platinum Group Metals (PGMs) production grew 7%, with Mogalakwena volumes increasing by 17% due to higher throughput and grade.


Iron ore output was steady versus the prior-year quarter, although production at Kumba increased 10% on higher plant availability.


Diamond production fell 7% to 7.2 million carats, driven by operational challenges, including excessive rainfall in southern Africa and a COVID-19-related shutdown in Canada, as well as planned maintenance in Namibia.


The company noted that rough diamond sales continued to improve amid midstream restocking following an encouraging holiday selling season for diamond jewellery in major global markets.

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