BHP Group: Cuts Iron Ore Production Guidance Amidst Tropical Cyclone

BHP Group - world's third largest iron ore producer has recently announced Q1 CY19 results. BHP Group's FY'19 (July'18- June'19) production guidance reduced to 265-273 MnT (100% basis) due to weather disruption in Mar'19. The production guidance was previously at 273-283 MnT.

The miner recorded production at 63.6 MnT for the quarter from Western Australia iron ore operations on 100% basis. The production dropped 3% on quarterly basis as against 65.5 MnT in Q4 CY18. The drop is attributed to cyclone veronica which hit the Pilbara region of Western Australia in Mar'19. Also, the cyclone hampered port Hedland impacting exports by the miner. On yearly basis too, the production fell 5% compared to 67.1 MnT in Q1 CY18.
The total production for first nine months FY'19 (Jul'18-Mar'19) recorded at 198.5 MnT, down against same period last fiscal at 202.9 MnT.

BHP Group's iron ore sales dropped in Q1 CY19

BHP Group's total iron ore sales from Pilbara on 100% basis recorded at 62.9 MnT for Q1CY'19, down 4% as against 65.8 MnT in Q4 CY18. On yearly basis, the sales fell 7% as against Q1 CY18 sales at 67.8 MnT. The total sales for nine month FY'19 (Jul'18-Mar'19) witnessed at 198 MnT down compared to 201.9 MnT for same period last fiscal.

BHP Group: Key Updates

• The South Flank project is expected to replace production from 80 MnT p.a. Yandi mines. The project is under progress and production is expected to initiate by CY21.
• Mining and processing operations at Samarco remain suspended following the failure of the Fundão tailings dam and Santarém water dam on 5 November 2015