10 Dec 2021 | 20:03 UTC

Anglo downgrades 2022-2023 Kumba iron ore output guidance

Highlights

Stacker refurbishment to impact port capacity

2022 unit cost guidance revised upwards

Diversified miner Anglo American has downgraded the guidance for 2022 and 2023 production at its Kumba iron ore mines in South Africa, the company said Dec. 10.

In 2022, total production from the Kumba mines is now foreseen at 39 million-41 million mt of iron ore, down from the 41.5 million-42.5 million mt expected previously, Anglo said in a statement.

For 2023, production guidance is also now put at 39 million-41 million mt, down from the previously-stated 41.5 million-42.5 million mt, it said.

"In 2022, Transnet's stacker reclaimer refurbishment program at the Saldanha Port will impact port capacity and, consequently, our value chain," said Themba Mkhwanazi, chief executive of Kumba. "In 2023, production is expected to be impacted by the tie-in of the Sishen ultra-high-dense-media separation plant. In line with our strategy, the UHDMS technology will extend the Sishen life-of-mine and further improve the quality and carbon reduction properties of our product in the steelmaking process, thereby optimizing the value of our product."

2021 sees 7% output growth

For 2021, production and sales are expected to remain in line with Anglo's full year 2021 guidance of around 40.5 million mt and 39.5 million mt, respectively, with production performance in 2021 expected to be 7% higher than that of 2020, the company said. "Following the completion of the annual maintenance program in October, operational performance has ramped up to planned levels," Mkhwanazi said.

Anglo continues to see the repercussions of the COVID-19 pandemic, including supply chain disruptions and rising input costs, the executive said. "Consequently, Sishen's unit cost is at the upper end of our guidance of R430 and R440/mt, while Kolomela's unit cost has increased to between R320 and R330/mt (from R305 to R315/mt). The Kumba C1 unit cost guidance for production of US$40/mt is unchanged," he said.

The C1 unit cost guidance for 2022 has been revised to around $41/mt, on a wet ton basis, Anglo said.