Joint venture (JV) partners Yancoal and Glencore are set to stand down contract staff at their Hunter Valley coal operations in New South Wales.
According to Glencore, workers will leave their roles according to the mine’s revised processing requirements from next January.
This is attributed to ongoing economic and demand impacts arising from the COVID-19 pandemic.
A Glencore spokesperson said that discussions had been initiated with the workforce on the changes that would be made to the operation’s processing requirements.
“The changes will not impact HVO’s permanent workforce numbers, but some contracting roles in the mining, coal preparation and maintenance areas will not be required under the revised production plan,” the spokesperson said.
Glencore holds a 49 per cent stake in the operation, with Yancoal holding the majority 51 per cent interest.
The JV produced 14.4 million tonnes of thermal and coking coal last year.
Thermal and semi-soft coking coal producers have been working against falling coal demand due to the COVID-19 pandemic.
According to the Australian Department of Industry, Science, Energy and Resources’ September quarterly report, the country’s thermal coal export earnings have continued to decline due to a contraction in seaborne trade.
It anticipates a fall in Australian thermal coal exports from $20 billion in 2019-20 to $15 billion in 2020-21, before reaching a partial recovery to $17 billion in the following period.
At present, the Newcastle benchmark price for thermal coal is forecast to average $US54 ($73.79) per tonne in 2020, before rising to $US65 a tonne in 2022.
This is still well below the 2018 high cycle peaks of $US120 per tonne.