South32 Coal Production Drops in South Africa
South32, which is in the process of exiting its SA coal assets, said last week that its domestic coal volumes declined in its half year to end-December. South32 energy coal production in South Africa decreased by 5% YoY to 11.2 million tonnes in the group's December 2020 half-year as domestic sales declined due to reduced demand from Eskom. A strengthening of the rand has also pushed up operating costs, while export sales were also lower following the suspension of activity from loss making pits in response to market conditions.
The deal to divest the SA Energy Coal (usiness to Seriti was announced in November 2019 and would result in Seriti becoming a major supplier of coal to Eskom. South32 is still awaiting approval from Eskom and aims to finalise the transaction by the end of March.