UBS mining analyst Lachlan Shaw said Grosvenor faced an...

UBS mining analyst Lachlan Shaw said Grosvenor faced an uncertain future, and the suspension of production was expected to add pressure to markets short-term, and offer a price floor.

“While it is early days in terms of understanding the full impact, judging by similar events in recent years, mine entry (after the fire) could be some months away, with a full rebuild and recovery to take place over an extended period,” Mr Shaw said.

“If the mine has sustained severe damage, a permanent closure cannot be ruled out, given this is the second gas ignition event in four years.”

Mr Shaw said coking coal supply growth had slowed in recent years as investment intentions were curtailed due to environmental, social, and governance concerns and high royalties imposed in Queensland.