Iron ore – Total iron ore production for the September 2015 quarter increased by seven per cent to a record 61 Mt. Guidance for the 2016 financial year remains unchanged at 247 Mt. Western Australia Iron Ore (WAIO) production increased by eight per cent in the September 2015 quarter to a record 67 Mt (100 per cent basis), supported by the ramp-up of the Jimblebar mining hub and improved ore handling plant utilisation at Newman.
Advertisement
It shows a record increase of 2.9% in iron ore production which has risen to 88.2 million metric tons.
“BHP Billiton remains on track to meet full-year production and cost guidance after a solid operational performance this quarter”, said BHP chief Andrew Mackenzie in the report’s release on Wednesday.
While that might normally be good news, it comes as capacity increases from Vale and peers Rio Tinto (RIO) and BHP Billiton (BHP) have led to concerns about oversupply.
BHP reported revenue from continuing operations down 21.4 percent, total revenue down 22.2 percent and capital spending down 24 percent for the period ending June 30 compared with previous year.
BHP shares closed 0.3 per cent higher in London at 1,096.50p.
Commodities suppliers are slashing capital expenditure, cutting debt and seeking to bolster balance sheets with raw materials prices mired in the longest slump in decades on weaker growth in China, the largest consumer of metals to grains.
In the same quarter, copper production fell 3 per cent year-on-year to 377,000 tonnes, while petroleum production declined 4 per cent to 64.5 million barrels of oil equivalent (mmboe). The producer purchased about 13,000 square kilometers (5,000 square miles) in the Beagle sub-basin in Western Australia, BHP said. · Approval received for the extension of operational permits for Cerro Colorado until 2023. The company said that first production from the Haju mine in Indonesia was achieved during the quarter. Output at Brazil’s Samarco rose to 3.7 million tons, it said.
Advertisement
A low cost of production has been the secret to miners’ profitability despite iron ore prices crashing to $52 a ton from almost $200 four years ago. Iron ore would average $53/tonne this year and $51 next year, rising back to $75 by 2020, it said this month.
