BHP Coking Coal Output Dips in H1 of 2020

In the first half of the financial year 2020-21, BHP Billiton’s metallurgical coal production decreased by 5% YoY to 19 million tonnes. The miner's metallurgical coal production guidance for the financial year 2020-2021 has remained unchanged and stands at between 40 million tonnes and 44 million tonnes, with a stronger second half performance. Volumes are expected to be in the lower half of the guidance range following significant wet weather impacts during the December 2020 quarter. The company continues to monitor for any potential impacts on volumes from restrictions on coal imports into China. Company said it would take a write-down of between AUD 1.15 billion and AUD 1.25 billion on its New South Wales Energy Coal assets, reducing its value to between AUD 250 million and AUD 350 million. BHP said the impairment reflected current market conditions for Australian thermal coal. It also named weakness in the Australian dollar, changes to the mine plan and an updated assessment of the likelihood of recovering tax losses as secondary reasons for the charge. The Australian coal industry has been rocked by China’s decision to ban imports believed to be in retaliation for Canberra’s call for an international probe of the origins of the coronavirus pandemic. Production guidance for the 2021 financial year remains unchanged for metallurgical coal at between 40 and 44 million tonnes (71 and 77 million tonnes on a 100 per cent basis) with a stronger second half performance projected