BHP’s iron ore production increases
BHP has reported an increase in iron ore production in the December quarter and, at its Olympic Dam mine in South Australia, near record gold production for the half year.
The Olympic Dam mine in SA's Far North. Photo: supplied.
BHP says its Western Australia iron ore production rose up three per cent in the December quarter thanks to easing labour constraints, less wet weather and strong supply chain performance.
The Big Australian on Thursday said it produced 66.9 million tonnes of iron ore in the three months to December 31, up three per cent from the September quarter and up one from a year ago.
It left its production guidance of 249-260 million tonnes for 2022/23 unchanged.
BHP said its coking coal production came in at 13.9 million tonnes for the December quarter, up four per cent from the previous quarter, but it only expects to meet the low end of its 2022/23 guidance.
Record wet weather in NSW, inflationary pressure and price-linked logistics costs will mean increased production costs at its Mt Arthur coalmine in NSW’s Hunter Valley region, BHP said.
At the company’s Olympic Dam operations, in South Australia’s far north, copper production was up 138 per cent for the half, mostly due to major smelter maintenance in the previous period, however, copper production guidance for the year is unchanged.
Near record gold production was achieved for the half, in the wake of “debottlenecking” initiatives in the previous year.
BHP’s move to acquire South Australian-headquartered miner OZ Minerals is expected to progress to a vote of its shareholders in coming months, the company reported.
“As foreshadowed, we are seeing the impact of inflation across our global supply chains and continue to focus on productivity and controllable costs,” chief executive Mike Henry said.
Heavy rainfall also impacted coking coal production in Queensland, BHP said. The coalmining town of Moranbah in the Isaac Region received 493mm in the second half of 2022, compared to 368mm for the same period in 2021.
BHP said it expected that China would be a “stabilising force” for commodity prices in 2023, with Western nations in the OECD experiencing economic headwinds.
“China’s pro-growth policies, including in the property sector, and an easing of COVID-19 restrictions are expected to support progressive improvement from the difficult economic conditions of the first half,” Henry said.
“China is expected to achieve its fifth straight year of over one billion tonnes of steel production.”
At 11.06am on Thursday, BHP shares were up 0.7 per cent to $49.40.
– with AAP
