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South32's Pain Eased as Other Commodities Gain -- Market Talk

15 Oct 2017 8:22 pm

2021 GMT [Dow Jones] South32 has gotten lucky that troubles at its Illawarra metallurgical coal operation have coincided with strong prices of other commodities, says RBC. South32 said Friday it had restarted production at its Appin colliery. However, mining will be restricted to one longwall through FY18 whereas commentary in August had suggested this would only happen for 2-3 months before a second longwall was brought back. South32 said its Illawarra operations produced 494,000 tons of metallurgical coal in 1Q, around a third of RBC's estimate. "In addition, the tone of the commentary suggests a more deep-rooted 'reset' of the operation following 'unacceptable levels of performance' over the last 12-18 months," RBC says. (david.winning@wsj.com; @dwinningWSJ)

(END) Dow Jones Newswires

October 15, 2017 16:22 ET (20:22 GMT)

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