BHP has brushed off market difficulties to post a rise in its quarterly iron ore output, aided by better performance from its Western Australian assets and a continued ramp-up at its South Flank project.
The higher production comes despite a 20 per cent fall in iron ore prices over the September quarter with growing global recessionary fears compounded by new COVID outbreaks and weaknesses in China’s housing sector.
According to Mysteel, the price for 62 per cent seaborne Australian iron ore fines at the port of Qingdao was $US93.7 ($149.4) per dry metric tonne on October 19.
Rio Tinto recently tempered its annual iron ore shipments forecast, after quarterly iron ore deliveries fell.
However, BHP said it had lower COVID impacts and strong supply chain performance over the September quarter from its Western Australia projects, despite the shortages of skilled labour from border closures and pandemic-forced worker absenteeism.
The miner produced 65 million tonnes (Mt) of iron ore in the first quarter of FY23, a 3 per cent rise from the first quarter of FY22. The company left its annual production and cost guidance unchanged.
Metallurgical coal production reached 6.7Mt, 1 per cent down on the prior corresponding period, on the back of lower volumes resulting from significant wet weather conditions, the mining of higher strip ratio areas, a planned longwall move at the Broadmeadow operation, and planned wash-plant maintenance at the Blackwater, Goonyella and Saraji operations in Queensland.
BHP chief executive officer Mike Henry said the company had started the new financial year strongly, achieving safe and reliable operating performance.
“The first quarter included significant planned major maintenance in Western Australia Iron Ore (WAIO), BHP Mitsubishi Alliance (Queensland), and Olympic Dam (South Australia),” he said.
“Copper production was up nine per cent on the same quarter last year, with strong concentrator throughput at Escondida, Chile, and record quarterly anode production at Olympic Dam.
“WAIO continued to perform strongly, with production up by 3 per cent relative to the same period last year, and we managed through substantial rainfall and labour constraints in our coal assets with production only down marginally year on year.”
Henry said he expected global macro-economic uncertainty to continue to affect supply chains, energy costs, labour markets and equipment and materials availability in the short term.