21 Apr BHP expects full-year iron ore guidance at upper end of forecast
BHP on Wednesday said it expects to deliver full-year iron ore output at the upper end of its forecast, despite reporting a near 2% dip in third quarter (Australian) production.
The announcement followed a similar 2% drop in Rio Tinto’s latest quarterly iron ore output, while Brazil’s Vale reported a hefty 19.5% fall on the last quarter. These disappointing production figures, along with booming Chinese steel-making margins, boosted the iron ore price by more than 4% on Tuesday.
However, BHP pledged to hit the top end of its 245 million tonnes (Mt) to 255 Mt forecast, after producing 66.7 Mt in the three months ending March. The world’s largest listed miner previously stated its third quarter production would be impacted by planned ore handling maintenance and tie-in activity between Mining Area C and the South Flank project in Western Australia’s Pilbara.
The US$3.4 billion South Flank replacement project involves construction of an 80 Mtpa crushing and screening plant, an overland conveyor system, stockyard and train loading facilities, procurement of new mining fleet and substantial mine development and pre-strip work.
Commissioning activities at the project are set to start in the June quarter, the company said. South Flank will continue to produce ore for over 25 years following the development.