Rail network manager Australian Rail Track (ARTC) has resumed a limited service on the Hunter Valley railway in New South Wales (NSW), as the 211mn t/yr capacity port of Newcastle and dependent mines try to return to normal.
The key section between Newcastle and Maitland, which was closed on 18 March, has been reopened after localised flooding eased today. It is only operating at a limited capacity and it is unclear when services will return to normal, as the ARTC continues to monitor the situation in the Sandgate area.
The Narrabri North to Moree section of the Hunter Valley network remains closed, but this is to the north of the coal mining region and should not impact deliveries of coal to Newcastle.
The severe storms that caused the flooding have cleared Newcastle and Sydney, but a strong wind warning is in place for the Illawarra region of NSW, which may disrupt shipments from Port Kembla today and tomorrow.
There is still a significant backlog of around 40 vessels at Newcastle. The 145mn t/yr capacity Port Waratah Coal Services (PWCS) terminals at Newcastle dispatched only one cargo a day from 18 March, when the ARTC closed the rail line connecting to the port, to 20 March. It then dispatched an average of four ships on 21 March from stockpiles, which might have been low because of a rail maintenance programme on 13-24 March.
The 66mn t/yr Newcastle Coal Infrastructure (NCIG) is still not operating after its remaining shiploader was closed on safety concerns on 19 March.
There has been no damage to the PWCS shiploaders and it will be able to accept coal diverted from NCIG once coal mining firms can organise to deliver them to its terminals, according to a spokesman.
UK-Swiss mining and trading firm Glencore, which exported 55.7mn t of coal from Australia in 2020, is operating at reduced capacity at some of its NSW mine sites. Chinese mining firm Yancoal, which expects to produce 39mn t of coal in Australia in 2021, has closed its 18mn t/yr open-cut mine at Mount Thorley Warkworth and 1mn t/yr Stratford-Duralie mine in the Hunter Valley because of the storms.
BHP’s 20mn t/yr Mount Pleasant mine in the Hunter Valley is still operating, according to a spokesman. Production slowed at the adjacent 12mn t/yr Bengalla mine, according to owner and operator Australian independent New Hope.
Whitehaven, which yesterday lowered its production guidance, does not expect its mines in the Gunnedah basin near Narrabri to flood but is monitoring local roads to ensure safe movement of staff and goods to the mine sites.
Argus last assessed high-grade Australian thermal coal at $90.67/t fob Newcastle for NAR 6,000 kcal/kg on 19 March, up from $89.62/t on 29 January and a low of $46.18/t on 4 September. Argus assessed lower-grade NAR 5,500 kcal/kg coal at $55.09/t fob Newcastle on 19 March, up from $55.01/t on 29 January and $35.04/t on 4 September.
Shipments of semi-soft coking coal typically account for around 12pc of Newcastle’s total exports. Argus assessed the semi-soft mid-volatile coking coal price at $92/t fob Australia on 19 March, up from $71.20/t on 31 December.