January 10, 2018 / 5:41 PM / a year ago

Output and exports from Colombia's Cerrejon coal mine fell in 2017

BOGOTA (Reuters) - Production and exports at Cerrejon, Colombia’s largest thermal coal mine, fell in 2017 for the third straight year as heavy rainfall affected operations, the mine’s owners said on Wednesday.    

Output reached 31.9 million tonnes in 2017, 0.3 percent below the previous year. Exports totalled 31.7 million tonnes, a drop of 2.4 percent compared with 2016, Cerrejon said.    

The mining company is currently negotiating wages and benefits with the main workers’ union which has threatened to strike if terms are not agreed by Jan. 19.

A strike at the Cerrejon mine could further reduce production and overseas sales from the world’s fifth-largest exporting nation of the mineral.

Cerrejon, one of the world’s largest open-pit coal mines, is located in northern La Guajira province. It has a railway line spanning more than 90 miles (150-km) and a seaport to handle shipments.

The trade union has demanded a 12 percent wage increase in the first year of a new contract, while the company has offered 5.2 percent as well as a bonus to each employee and health and education benefits.

Cerrejon’s offer is above the 4.09 percent inflation for last year, but the union has said it falls short of expectations given strong coal prices in recent months.

Cerrejon, which belongs in equal parts to BHP Billiton BLT.L, Anglo American AAL. and Glencore (GLEN.L), has said its offer is fair and based on projections for a difficult year in international coal markets.

Colombia produced 65.1 million tonnes of coal in the first nine months of 2017, 4.4 percent lower than for the same period a year earlier. It set a production target above 90 million tonnes for 2017.

Reporting by Luis Jaime Acosta; Writing by Helen Murphy; Editing by Tom Brown

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