Whitehaven Coal lifts FY production

Shares in Whitehaven Coal have lifted after it increased coal production in fiscal 2014 to a record level but has warned it expects a state of oversupply over the next six months.

At 10.50am (AEST), Whitehaven shares were 5.42% higher at $1.555, against a benchmark index lift of 0.21%.

Managed run of mine coal production rose by 27% to 11.533 million tonnes in the year to June 30, compared with 9.072 million tonnes in the previous corresponding period.

In the June quarter, production lifted 68% to 3.785 million tonnes, compared with 2.247 million in the previous corresponding period. 

Whitehaven noted strong performance at all its mines, with Narrabri, Tarrawonga and Werris Creek posting new production records.

The miner said demand continues to grow, but at a lower rate than in recent years, while an increase in thermal coal exports from Indonesia, Australia and Colombia have increased in the first half of the year, weighing on prices.

For thermal coal, the miner posted an average price of $US72.81 per tonne in the June quarter. This was slightly below the benchmark Newcastle thermal coal index, which fell 6.4% during the period to $US73.05 per tonne.

For metallurgical coal, Whitehaven reported an average price of $US93.63 per tonne in the quarter and expects prices to fall to between $US91 per tonne and $US92 per tonne in the September quarter.

Cuts in metallurgical coal production in the US, Canada, Australia and Mozambique should lead to a modest recovery in prices towards the end of calendar 2014, the miner said. 

Whitehaven said its Maules Creek mine is more than 50% complete, on schedule and on budget, with first coal set to be transported in March 2015.

The controversial project has been the target of a long-running protest campaign, including legal action and human barricades to stall and protest the alleged destruction of the Leard State Forest.