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BHP Group’s copper output surged 17% in its second quarter, taking up some of the slack from its traditional asset base iron ore which was largely unchanged amid softening demand.
The world’s biggest miner ramped up production at its massive Escondida copper mine in Chile by 33% in the three months to Dec. 31, and extracted higher-grade ores of the metal that’s increasingly vital to the energy transition. That helped offset declines at its South Australian projects, which were shuttered for weeks after an electrical storm cut power supply.
Meanwhile, iron ore output rose just 1% in the period. While the commodity still accounts for about two-thirds of BHP’s revenue, it sees long-term demand for the steelmaking material being pressured by a bleaker outlook for China’s economy and languishing property market, and in recent years has bolstered its expansion strategy in other materials.
The company’s thirst to grow its exposure to copper drove management’s $49 billion attempt to acquire Anglo American Plc last year. When that failed, BHP launched a takeover of Filo Corp. alongside partner Lundin Mining Corp., giving it access to copper projects straddling the Argentina-Chile border that are yet to be developed. That transaction closed this month.
BHP Chief Executive Mike Henry said the Filo assets were “one of the most significant global copper discoveries in decades.”
Iron ore output was 66.2 million tons in the three months to Dec. 31. Full-year guidance for those operations was maintained at 255 to 265.5 million tons, with the miner keeping forecasts unchanged for all its commodities.
Meanwhile, steelmaking-coal production slumped 23% in the three-month period, while energy coal dipped 4%. Copper output totaled 510,700 tons.
“Our flagship copper, iron ore and steelmaking coal assets delivered particularly strong production in the period,” Henry said in the statement. “We made further progress on our growth pathways in future-facing commodities.”
From current heights of around 1 billion tons per annum, Bloomberg Intelligence forecasts predict annual China steel consumption could fall below 800 million tons by the end of this decade.
Iron ore was one of 2024’s worst performing commodities, slumping 28%. That included an 8% decline in the year’s final quarter.
This article was generated from an automated news agency feed without modifications to text.
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