Diverse miner Glencore produced 102.7 million tonnes of coal during January-September, slipping 8% year on year, as it continued to limit production in a weak market environment, the company said on November 4.

The miner produced 16.2 million tonnes of South African export thermal coal during the first nine months of 2015, falling 7% on year.

Output of South African domestic thermal coal for the first three quarters of the year also fell 8% on year to 15.6 million tonnes.

Glencore attributed the lower production at its South African operations to the closure of the Optimum opencut operations and Middelkraal. However, the miner noted that Optimum's underground mine was still operating, although it was under business rescue proceedings, and increased production at Impunzi and Tweefontein has partly mitigated the overall reduction.

At its Colombian operations, Glencore produced 13.9 million tonnes at Prodeco over January-September, slipping 8% on year, as it lowered production to meet temporary night railing restrictions.

At the same time, the miner's 33.3% pro-rata share of production from the Cerrejon mine was 8.4 million tonnes, edging 2% higher.

In Australia, its export thermal coal production for the first nine months dipped 8% on year to 38.8 million tonnes, while domestic thermal coal production at the Australian operations dropped 31% from the same period in 2014 to 2.9 million tonnes.

Glencore has been scaling back production in Australia due to weak market conditions.

Australian coking coal production for the first nine months of 2015 fell 9% on year to 4.2 million tonnes, due to geological issues at Oaky North, while semi-soft coking coal output rose 8% on year to 2.7 million tonnes.

All average energy commodity export prices fell compared to the first nine months of 2014, with the South African thermal coal average realized export price dropping 23% on year to $54/t.

The average realized export price of Australian thermal coal dropped 16% from the year before to $61/t, while in Colombia, the average realized export prices for the period were $64/t at Prodeco and $57/t at Cerrejon, slipping 175 and 15% on year, respectively.

In Australia, the average realized export price of coking coal and semi-soft fell 16% and 18% on year, respectively, to $101/t and $79/t.

http://en.sxcoal.com/0/134340/DataShow.html

The German cabinet on Wednesday approved a plan to pay utilities to set aside some of their coal-fired power capacity as Europe's biggest economy looks to ensure stable supply and reduce carbon emissions.

Some 2.7 gigawatts (GW) of power generation from brown coal, equivalent to the output of eight power plants, will be placed in reserve and shut down by 2022, a government official said.

The plan is part of Germany's efforts to cut its carbon emissions by 12.5 million tons by 2020.

In July, Economy Minister Sigmar Gabriel abandoned plans for a levy on coal-fired power plants and instead announced that companies would be paid to shift capacity to the reserve.

Utilities RWE, Vattenfall and Mibrag will reduce coal-fired power output from the start of winter 2016 and receive an average of 230 million euros ($251 million) per year collectively.

Consumers are expected to face higher electricity bills as costs of around 1.6 billion euros for the scheme will not be shouldered by the government.

Opposition lawmaker Oliver Krischer from the Green Party accused Gabriel of yielding to the interests of the utilities and creating a reserve which no-one needed at great cost.

It remains to be seen whether the European Commission will approve the plan, he said.

The Cabinet also passed a new electricity market design which allows utilities to charge higher prices at times of shortages when wind or renewable energy sources cannot provide sufficient supply.

This could help operators of gas-fired power plants which are not profitable under current conditions due to low spot prices and competition from cheaper coal and renewables.


Read more at Reutershttp://www.reuters.com/article/2015/11/04/germany-energy-coal-idUSL8N12Z24120151104#KYgGtplAdhuAMdf0.99

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China's coal imports from the eastern Australian port of Gladstone rose to 956,000 tonnes in October, up 53% from 624,000 tonnes in September, said Gladstone Ports Corporation on November 4.

China’s imports of Gladstone coal over January-October stood at 9.6 million tonnes, down 32.9% from 14.3 million tonnes in the first ten months of 2014.

South Korea's demand for Gladstone coal jumped to its highest in 27 months in October at 1.4 million tonnes, up 60% from September's shipments of 873,000 tonnes.

Over January-October, South Korea imported 9.1 million tonnes of coal from Gladstone port, up 15.2% from a year earlier, the port data showed.

Indian customers booked 1.28 million tonnes of coal from Gladstone port's three coal terminals in October, down 23.5% from 1.68 million tonnes in September. Its total imports from Gladstone port stood at 12.33 million tonnes over January-October, compared with 11.2 million tonnes a year ago.

Japan, another major customer, consumed 1.68 million tonnes of coal from Gladstone in October, down 16% from 2 million tonnes in September.

The port has exported 59.3 million tonnes of coal over January-October, up 1 million tonne from a year earlier.

http://en.sxcoal.com/0/134348/DataShow.html

Rio Tinto said on Thursday it expects to see strong growth in iron ore demand in countries outside of China as the global seaborne market expands.

China has long been the top market for sea-traded iron ore, importing close to 1 billion tonnes a year, out of a global market of 1.4 billion tonnes. Rio Tinto accounts for about a third of China's imports.

"We project that the world will demand around 3 billion tonnes of iron ore by 2030, a 2 percent average annual increase from today's levels," Rio Tinto's iron ore head Andrew Harding said.

"We are expecting non-Chinese demand for steel to increase by 65 per cent in the period to 2030, with ASEAN (Association of Southeast Asian Nations) economies and India playing key roles," Harding said in a speech to business leaders in Perth.

Half of the expansion in global iron ore demand will be supplied through the seaborne market, according to Harding, where Australia and Brazil are the dominant suppliers.

Still, Chinese demand for ore will be "critically important," with steel production expected to grow 1 percent a year from a very high base, he said.

Harding's comments run counter to forecasts by the China Iron & Steel Association (CISA), which sees China's crude steel output declining to 780 million tonnes by 2020 from 823 million tonnes in 2014, as steelmakers grapple with slower demand growth and tumbling prices.

CISA on Wednesday said it expected China's crude steel production to fall this year and next, with a brief rebound in 2017 before resuming the downward trend.

China's steel sector is already struggling with 300 million tonnes of surplus capacity, pushing iron ore prices to their lowest since July, while inventories at Chinese ports have ballooned to the highest since May.


Read more at Reutershttp://www.reuters.com/article/2015/11/05/rio-tinto-australia-iron-idUSL3N1301B020151105#qVCrrxfzOEMjQQOF.99

Image Source: dredgingtodayBloomberg reported that Iron ore cargoes from Australia's Port Hedland to China fell last month to the lowest level since July ahead of a seasonal slowdown in the largest buyer that may compound a decline in production and consumption as the economy cools.

Exports to China were 30.7 million metric tons from 33.8 million tons the previous month and 31.7 million tons a year earlier, according to data from the Pilbara Ports Authority on Wednesday. Overall iron ore shipments totalled 36.5 million tons, down from a record 39.4 million tons in September and 37.5 million tons a year ago.

For the year-to-date, shipments are still well ahead of 2014. Exports to China from Port Hedland were 314 million tons in the first 10 months compared with about 284 million tons in the same period in 2014.

http://steelguru.com/mining/ore-exports-from-port-hedland-sink-in-october/438501#tag

 
China's output of crude steel is expected to fall to 780 million tonnes by 2020, the China Iron & Steel Association (CISA) said on Wednesday, as the steel sector grapples with slower demand growth and tumbling prices. China's crude steel production will fall this year and the next, with a brief rebound in 2017 before resuming its downward trend, CISA told an industry conference in Beijing.

With steel prices hitting their lowest in more than two decades, the country's massive steel sector is struggling with surplus capacity of about 300 million tonnes and cooling demand growth.

However, top iron ore miners, including Rio Tinto and BHP Billiton , are still expanding output, betting on sustainable growth in China, despite the contraction in steel output by the world's biggest producer.

BHP sees moderate but sustainable growth in Chinese steel production over the next decade, although it cut its forecast for peak steel production to between 935 million and 985 million tonnes in the mid-2020s, down from 1 billion tonnes previously.

Shrinking demand, soaring losses and tighter credit have undermined Chinese steel firms, with more, particularly in the northern region, expected to make deeper output cuts over the next few months.

Anshan Iron & Steel Group, one of China's major state-owned steel firms, has suspended operations at some blast furnaces this week, industry sources said.

China's apparent crude steel consumption fell in 2014 for the first time in three decades, to stand down 3.4 percent at 738.3 million tonnes. Consumption for the first nine months of this year dropped 5.8 percent to 533 million tonnes.

http://en.chinamining.com.cn/News/2015-11-05/1446692377d74367.html

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Tata Steel has announced a new carbon-cutting project called HIsarna, which could cut CO2 emissions by 20 percent.

In conjunction with Rio Tinto and other European steelmakers, the project is being piloted at IJmuiden steelworks in the Netherlands.

Research suggests it could reduce today’s steel industry CO2 emissions and energy use, as well as lower the emissions of fine particle dust and dioxins, and nitrogen and sulphur oxides.

http://steelguru.com/steel/tata-steel-announces-carbon-reduction-project/438419#tag

Six American steel makers including U.S. Steel filed three trade complaints earlier this year. On Tuesday, they received a preliminary ruling on the first as the Commerce Department established preliminary duties of up to 236% on imports of corrosion-resistant steel from China. The tariff goes into effect immediately and will be set for five years if a final ruling in favour of the duty is made in January.

U.S. Steel Chief Executive Mario Longhi pointed to the role of Chinese imports in a company statement Tuesday, saying that “excessively high levels of imports, much of which we believe are unfairly traded” hit steel prices.

A U.S. Steel spokeswoman said the tariffs were “a good first step” and that the company is looking forward to the next decision, “encouraged that our federal agencies tasked with this critical oversight and enforcement of our trade laws will halt these harmful, illegal and unfair practices.”

China’s Commerce Ministry declined immediate comment, saying it was looking into the decision. Phone calls to the China Iron and Steel Association weren’t answered.

Steelmakers in China and other countries have denied taking advantage of domestic subsidies or other favours to dump low-cost steel on U.S. markets.

Overall, imports of steel into the U.S. are slightly down in 2015, but they have increased dramatically for certain key steel categories, including the corrosion-resistant steel hit by the preliminary tariff.

Many categories of steel are offered at such low rates that they’re “toxic for pricing,” said Phil Gibbs, an analyst for Cleveland-based Keybanc Capital Markets.

The tariffs will provide some support for prices in the U.S., but some analysts say companies are going to have make longer-term structural changes.

“We could see steel prices stay this low for the next 10 years,” Mr. Gibbs said.

The Commerce Department also set smaller duties on imports from India, South Korea and Italy. A separate ruling on the case will be issued in December.

http://www.wsj.com/articles/u-s-steel-projects-worse-than-expected-shipments-in-2015-1446589798

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U.S. Steel continues to rack up huge losses despite an aggressive cost cutting program.

The Pittsburgh-based company reported a third quarter net loss of $173 million US Tuesday afternoon. That brings its losses for nine months of 2015 to more than $509 million US.

The latter includes a $53-million US loss to shut down blast furnace, steelmaking and most flat-rolled operations at its Fairfield Works and a $10-million US charge for a pension obligation related to its troubled U.S. Steel Canada operation.

In a news release, company president Mario Longhi blamed the poor performance on unfair imports of subsidized foreign steel and a sluggish American economy.

"Total segment (earnings before interest and taxes) improved as compared to the second quarter as we continued to take action to address our cost structure," he said. "We remain focused on our Carnegie Way transformation efforts to weather the continued difficult market environment. These efforts will better position our company to generate stronger operating margins and respond to changing market conditions."

Carnegie Way, named for company founder Andrew Carnegie, is an aggressive cost cutting program that Longhi said has so far trimmed $715 million US from its operations.

Despite its losses the company has strong liquidity of $2.9 billion US, including $1.2 billion US in cash.

For the rest of 2015, the company predicts adjusted earnings before interest, taxes, depreciation and amortization of about $225 million US.

The quarterly results compare to a net loss of $207 million US in the same period last year and a second quarter 2015 net loss of $261 million US.

The results reported from the company's American headquarters do not include figures for its Canadian arm, which is under creditor protection.

The court-appointed monitor of that process recently reported year-to-date losses of $343.8 million.

The American company noted year-to-date losses of $217 million US associated with U.S. Steel Canada. That's down from $413 million US for the same period last year.

[U.S. Steel wants Canadian unit to pay $2.2B debt]

However, it also reported improved results in the flat-rolled steel segment compared to the second quarter, although it contends the sector continues to be plagued by unfair imports.

"Imported flat-rolled products, much of which we believe are dumped and/or subsidized, remained excessively high in the third quarter, causing further damage to the domestic market," it said in a release. "Based on preliminary statistics, imported sheet products still averaged more than one million tons per month in the third quarter and not only continued to erode our market share, but also placed downward pressure on both our spot and our contract prices."

Average prices for the quarter were $674 US per ton, down from $777 US for the same period last year. The year-to-date average price was $712 US per ton.

Looking ahead, Longhi said the future is not bright.

"Commercial markets are not improving as we had anticipated for the second half of 2015. Steel selling prices reversed direction as excessively high levels of imports, much of which we believe are unfairly traded, and a significant decline in steel scrap prices caused spot prices to reach new lows for the year," he added. "High import levels also had a negative impact on the rebalancing of supply chain inventories, decreasing customer order rates in the second half of the year."

Based on those factors, Longhi said the company expects "significantly lower shipments and average realized prices than we previously projected for full-year 2015."

http://www.thespec.com/news-story/6079315-u-s-steel-reports-another-huge-loss/