Australia: BHP's iron ore production falls in Q1CY23, FY23 guidance unchanged

BHP Group has announced its first quarter (Q1CY23) results recently. Iron ore production in Q1CY23 stood at 66.16 million tonnes (mnt), down 12.3% q-o-q in Q1CY23 compared to 74.3 mnt in Q4CY22.

Lower volumes at the company's Western Australia Iron Ore (WAIO) operations were due to the temporary shutdown of all operations following a fatal accident in February, and the planned tie-in activity of the Port Debottlenecking Project.

Iron ore sales decrease

The company's total iron ore sales decreased by 8.3% q-o-q to 66.6 mnt in Q1CY23 as against 72.7 mnt in Q4CY22. Sales decreased slightly against 67.11 mnt in Q1CY22.

Other highlights

Production guidance for FY23 unchanged: BHP's FY23 ((July 2022- June 2023) iron ore production guidance from Western Australia remains unchanged at around 249-260 mnt.

Update on Port Hedland Operations: There has been no significant damage or reported injuries at the WAIO sites as a result of Tropical Cyclone Ilsa in April. Port operations were suspended in coordination with the Pilbara Ports Authority but have resumed normal operations.

South Flank to reach full capacity in 3 years: The South Flank ramp-up to the full production capacity of 80 mnt/year (on a 100% basis) is proceeding as planned. Current year performance has contributed to record year-to-date WAIO iron ore lump sales. Additionally, the deployment of autonomous haul trucks is progressing well and is expected to be completed by the end of 2023.

Samarco pellet production guidance unchanged: Production for the 2023 financial year is expected to be at the top of the guidance range of 3 and 4 mnt (BHP share). However, Samarco's production increased by 7% to 3.3 mnt year-to-date (BHP share) reflecting strong concentrator performance.