BHP cuts FY'22 copper, nickel guidance; fiscal Q3 iron ore output flat YOY

BHP Group Ltd. lowered its full-year 2022 group copper guidance and slashed its nickel output forecast as the Australian mining company released its fiscal third-quarter production figures.

Group copper guidance was lowered to between 1.57 million tonnes and 1.62 Mt, from between 1.59 Mt and 1.76 Mt, on the back of lower expected output from the Escondida mine in Chile of between 1.00 Mt and 1.03 Mt.

Production at its Nickel West operation in Western Australia is expected to hit between 80,000 tonnes and 85,000 tonnes, dropping from between 85,000 tonnes and 95,000 tonnes, due to the impact of COVID-19 related worker shortages.

During the fiscal third quarter, iron ore production was 59.7 Mt, broadly in line with the year-ago quarter output of 60.0 Mt but down 10% quarter over quarter due to COVID-19 infections affecting labor availability and a shortage of train drivers. Full-year 2022 production forecast remains unchanged at between 249 Mt and 259 Mt.

Copper production slumped 6% yearly to 369,700 tonnes, as its Chilean operations experienced challenges due to rising COVID-19 cases. The Escondida mine's output fell 9% to 226,400 tonnes.

Output from Nickel West in the three months slumped 8% to 18,700 tonnes on the back of COVID-19 related labor shortages.

Metallurgical coal output increased 10% to 10.6 Mt, but energy coal production fell 14% to 2.6 Mt caused by inclement weather and labor constraints during the period. Guidance for metallurgical coal for the year was retained at between 38 Mt and 41 Mt, while energy coal guidance remained at between 13 Mt and 15 Mt.

S&P Global Commodity Insights produces content for distribution on S&P Capital IQ Pro.