May 21, 2020 / 4:45 PM / in 15 days

Colombia coal output down 7.2% in Q1 on low prices, coronavirus lockdown

BOGOTA, May 21 (Reuters) - Coal production in Colombia, the world’s fifth-largest coal exporter, fell 7.2% in the first quarter because of low prices and coronavirus quarantine measures, the government said on Thursday.

The South American country produced 19.4 million tonnes of the fuel between January and March, compared with output of 20.9 million tonnes in the same period in 2019, the mines and energy ministry and national mining agency said in a joint statement.

More than two months of coronavirus lockdown began in the country in March. Though coal mining was exempt from a full shutdown, many mines reduced operations at least initially.

“The fall in prices that was being registered from 2019, as well as the reduction in operations of some companies as a preventative COVID-19 contingency measure are the principal causes of the decrease in coal production,” Silvana Habib, head of the National Mining Agency, said in the statement.

Coal is fundamental for job creation, investment and income in the country, the statement added. Colombia produced 82.2 million tonnes of coal in 2019.

Major players in the coal industry include Cerrejon, jointly owned by BHP Group, Anglo American Plc and Glencore Plc, Drummond and Prodeco, which is a unit of Glencore.

Gold production was up 7% compared with the first quarter of 2019, to 9.5 tonnes, thanks to a seven-year high in prices.

“The prices for (gold), key to the diversification of the mining sector, have had an increase of 26% in the last year, which represents opportunities for the reactivation of employment and royalty income,” mines and energy minister Maria Fernanda Suarez said in the statement.

Nickel production was up 10.3% compared to the same period last year, to 22.7 million pounds.

Mining royalties in the first quarter totaled 518 billion pesos (about $136 million), with coal contributing 79%, nickel 10%, gold 9% and other minerals 2%.

Reporting by Julia Symmes Cobb; Editing by Lisa Shumaker

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