Colombia’s top coal exporter Cerrejon LLC has produced about 23 million metric tons through mid-September and is sticking to its full-year output goal of 32 million metric tons despite recent heavy rains, company president Leon Teicher said Monday.
Cerrejon is equally owned by mining giants Xstrata PLC, Anglo American PLC and BHP Billiton.
Teicher, who earlier this month said he’s quitting at the end of the year for personal reasons, told reporters the company has built back its inventory to about 2 million metric tons of coal. As such, if rains were to continue to intensify over the coming months, causing a drop in production, the company should still be able to meet its target by drawing down some of its inventory.
Asked whether, even with the inventory, the heavy rains might force the company to revise down its output target, Teicher said: “There’s always that possibility, but one has to be sufficiently flexible to adapt to those conditions.”
La Nina rains forced a halt in Colombian coal production for a few days last year and also affected distribution lines. Cerrejon ended up using about 1 million metric tons from its inventory to ensure it met its obligations with buyers.
Teicher also said that recent worries about possible economic recession in the U.S. and Europe, its main targets, have not caused the company to redirect its sales efforts toward Asia.
Last month, Teicher said Asia will represent about 5% of the company’s coal exports this year, down from 10% in 2010. He said at the time the company will focus its efforts on its “natural markets” that include the U.S. and Europe.
The company has said it is continuing with its expansion plans that will allow output to rise to 37 million metric tons in 2014 and 40 million tons in 2015.
Teicher said Colombia’s overall coal output could surpass 75 million metric tons this year.