Teck’s 3Q production rises, but guidance maintained
Canadian mining firm Teck Resources produced 6.5mn t of coking coal in the third quarter, up by 2pc on the year, despite logistical constraints and material handling issues.
Teck sold 6.1mn t of coking coal in the third quarter, down by 9pc from a year ago and below Teck's initial guidance of 5.6mn-6.5mn t. Cost of sales, meanwhile, was unchanged at $67/t from a year earlier. But lower spending, along with higher expected production in the fourth quarter, should eventually help to reduce Teck's unit costs per tonne.
Planned construction outages at the Neptune Bulk Terminals were in progress throughout the quarter, resulting in material handling issues and keeping inventories at full capacity.
But the producer still expects 2019 production to be maintained at 25.5mn-26mn t as facility upgrades at the Neptune Bulk Terminals are expected to be completed in the first quarter of 2021.
Meanwhile, sales volumes in the fourth quarter are expected to take a hit because of planned outages at Ridley Terminals and Neptune Bulk Terminals, resulting in about 40 lost berthing days.
Despite falling met coal spot prices amid increased pressure on steel producers' margins caused by weakening steel prices, Teck sees support from steel demand growth in India and southeast Asia as well as stronger demand for imports in China.
source: Argus Media
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