Australia: BHP's iron ore production falls marginally y-o-y in CY23, guidance unchanged

BHP Group Limited recently released its results for the calendar year 2023 (CY'23). Iron ore production from its Western Australia mines in CY'23 was reported at 280.98 million tonnes (mnt) on a 100% basis, experiencing a slight 1% y-o-y decrease compared to 284.8 mnt in CY'22. These production figures encompass all of BHP's mines.

The decline in production can be attributed to the ongoing tie-in activity for the Rail Technology Programme (RTP1) and the impacts of the continuous ramp-up of the Central Pilbara hub (South Flank and Mining Area C).

BHP's output showed a modest 4% increase to 65.8 mnt q-o-q in Q4CY'23, compared to 63.2 mnt in Q3CY'23. However, BHP's production witnessed an 11% y-o-y decrease in Q4CY'23 against Q4CY'22, where it stood at 74.3 mnt of iron ore.

Iron ore sales fall marginally in CY'23

The company reported total iron ore sales from Pilbara on a 100% basis at 279.9 mnt in CY'23, experiencing a slight 1% y-o-y decline compared to 282.9 mnt in CY'22.

Quarter-on-quarter (q-o-q), sales decreased by 2% to 70.34 mnt in Q4CY'23 compared to 71.74 mnt in Q3CY'23. BHP's sales also saw a 3% y-o-y decrease in Q4CY'23 against Q4CY'22, where it stood at 72.7 mnt.

Other highlights

• Production guidance for FY'24 (July 2023- June 2024) unchanged: BHP's iron ore production guidance for FY'24 (July 2023 - June 2024) from Western Australia stays consistent within the range of 254-264.5 mnt. The 100% guidance also remains stable, ranging between 282-294 mnt.
  
  
• South Flank to reach full capacity by end of FY'24:South Flank remains on track to ramp up to full production capacity of 80 mnt/year (100% basis) by the end of FY'24. The planned tie-in of the Port Debottlenecking Project (PDP1) continues to progress and remains on track to be completed in CY'24.
  
  
• Samarco pellet production guidance unchanged: Samarco's production guidance for FY'24 remains unchanged at between 4 and 4.5 mnt. Pellet production in Q4 stood at 1.3 mnt. Production increased as a result of higher concentrator throughput.