The move, which comes as the thermal coal price continues to drift downwards amid agreements by the Chinese government to limit the use of coal for power generation, will see 5 million tonnes come out of production for the company.

“Glencore has decided to implement production shut downs across our Australian coal operations for three weeks starting mid-December,” the company said.

“This is a considered management decision given the current oversupply situation and reduces the need to push incremental sales into an already weak pricing environment.

“We remain confident in demand growth for our products and believe that the supply and demand balance will be restored in the medium term.”

Glencore had increased its total coal production for the September quarter by 7% to 111.4 million tonnes, due mainly to the start of longwall mining at the Ulan West mine in New South Wales and higher productivity from its other Australia thermal coal operations.

The completion of various advanced-stage thermal coal expansion projects also played their part in the better result coal result.

Australian thermal and semi-soft production for the September quarter was 49.1Mt – 11% higher than the previous comparable period.

“The increase reflects the start of longwall operations at Ulan West and productivity improvements at the Bulga complex,” Glencore said.

“Expansion projects at Ravensworth North and Rolleston also contributed to the increase.”

The story for Australian coking coal production was not as bright. It dropped by 18% to 4.6Mt mainly because of cost reduction initiatives that resulted in mine plan and roster changes at Newlands, Oaky Creek and Collinsville, and the impact of mining through a fault at Oaky North.