Here’s how COVID-19 is impacting these 5 producers
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Global COVID-19 containment measures are sparking a raft of short-term mine shutdowns or production cuts, which are never ideal for a miner’s bottom line.
So far, impacts have been varied across commodity and jurisdiction.
For example, South Africa and Quebec have shuttered their mining industries for three weeks. In Australia, the resources sector will continue working through the intensifying coronavirus lockdown for now.
Aussie gold miner Saracen Mineral Holdings (ASX:SAR) says COVID-19 measures will have minimal impact on record March quarter production of ~155,000oz.
The company won’t withdraw its FY2020 guidance of +500,000oz yet, but there is no certainty that operations will not be impacted in the June quarter, it says.
Saracen also has +1.7 million ounces in large ore stockpiles available for milling “which will help insulate the business should mining be further restricted”.
Investors liked the news, sending the ~$4 billion market cap stock up 4.3 per cent in early trade.
WA mineral sands miner Image Resources (ASX:IMA) also says operations at its Boonanarring project are continuing “with minimal impact to-date”, sending the stock up 12 per cent.
Pilbara lithium miner Altura (ASX:AJM) anticipates March quarter production to be 40,000-43,000 tonnes, which is marginally lower than previous guidance “due to adverse impacts associated with tropical cyclones during the period”.
When it comes to COVID-19, Altura advises that its lithium mine and plant continue to be fully operational “at this stage”.
Some ASX-listed miners based overseas haven’t been so lucky.
South African coal producer MC Mining (ASX:MCM) was impacted by the government’s recently announced 21-day national lockdown to contain the spread of COVID-19.
FY20 production guidance has been suspended until the company is in a better position to quantify the full impact of the lockdown.
Graphite miner Syrah Resources (ASX:SYR) says new restrictions on international and domestic travel are limiting the mobility of its workforce, forcing the temporary suspension of production at the Balama operation in Mozambique.
“Syrah continues to expect its end of quarter cash balance to be broadly aligned to existing guidance of $US64.6m,” it says.
“The company believes this level of liquidity and the recently implemented companywide cost restructure positions the company well to manage an extended period of uncertainty.”