BHP hits new highs in iron ore and copper after strong finish to the financial year

BHP has capped off the financial year with record iron ore production and output from other commodities across its global resource portfolio that hit guidance, including its highest copper production result in 15 years.

The Big Australian — which just a week ago revealed it would shutter its entire WA Nickel business amid a stagnant market for the key battery material — on Wednesday reported a 2 per cent rise in full-year iron ore production from its Pilbara operations to 287 million tonnes.

BHP said that came off the back of its South Flank project hitting nameplate run-rate of 80mtpa during the year and increased shipping capacity through its debottling efforts at Port Hedland.

It is tipping only a marginal rise in full-year production from its WA Iron Ore business this year to between 255 and 265.5mt, while its 100 per cent basis forecast remains unchanged at between 282 and 294mt.

Copper production soared 9 per cent to 1.87 kilotons, led by its operations in South Australia which benefited from the first full year of additional tonnes following the $9.6 billion takeover of OZ Minerals in May 2023.

Despite the failed takeover of the copper-rich Anglo American earlier this year, BHP believes it can keep growing its copper output. The top end of guidance for this financial year would take production to just over 2kt.

Chief executive Mike Henry said the miner ended the year with a strong fourth quarter, achieving several production records and meeting production and unit cost guidance for all commodities.

“WA Iron Ore continued its strong performance, delivering a second consecutive year of record production on the back of ongoing incremental improvements along its supply chain as we progress toward our medium-term goal of increasing production to greater than 305mtpa,” Mr Henry said.

“We achieved a strong performance across our copper business globally, underpinned by the highest production in four years at Escondida and another year of record production from Spence in Chile.

“Successful integration at Copper South Australia has delivered additional production tonnes, and exceeded the annualised synergies planned at the time of the OZL acquisition.”

BHP’s WA nickel business increased full-year production to 81,600t, up 2 per cent.

But those assets are now starting to be placed on care and maintenance as a flood of cheap supply from Indonesia keeps a lid on a price recovery for the metal.

BHP’s nickel interests in WA mainly encompass the Nickel West portfolio as well as the under-construction West Musgrave project it picked up as part of the OZ Minerals acquisition.

More than 3000 jobs will be affected when the suspension begins from October and operations wind down by December, but there are hopes many will find other roles across BHP’s other operations or fill labour shortages in WA’s booming gold sector.

The miner earlier this year effectively wiped the value of the portfolio to zero and on Wednesday forecast it would cop a further $US300 million charge against the business and record a $US300m loss for the financial year.

A note from Citi to clients said the quarterly production numbers beat expectations across all key divisions.

Citi also said FY2025 production guidance is largely as expected, meaning that the output outlook is “relatively flat” with copper up, iron ore flat and coal down.