Iron Ore

BHP reaffirms FY23 guidance as iron ore production ramps up

Wed 19 Oct 22, 10:18am (AEST)
BHP Iron Ore Train
Source: iStock

Key Points

  • BHP said all its production and cost guidance remains unchanged for FY23
  • Improved supply chain performance and lower covid-related impacts helped offset adverse weather conditions
  • Energy coal production took a massive hit due to ongoing wet weather impacts in NSW

BHP (ASX: BHP) reaffirmed its FY23 production and cost guidance thanks to strong output across its assets in Chile and Western Australia as well as more manageable weather and covid-related impacts.

"We expect global macro-economic uncertainty in the short term to continue to affect supply chains, energy costs, labour markets and equipment and materials availability," said CEO Mike Henry.

September quarter: Highlights


Total copper production rose 9% compared to the prior period, aided by higher concentrator feed grades at Escondida in Chile. Escondida accounts for more than 50% of BHP's overall copper output.

Copper contributed to approximately 21.2% of BHP's earnings in FY22.

Iron ore

Total iron ore production increased by 3% to 65m tonnes. Almost all of BHP's iron ore production comes from the Western Australian Iron Ore (WAIO) hub.

Higher production reflected improved supply chain performance and easing covid-related impacts, which was partially offset by wet weather conditions.

South Flank - which commenced production in 2018 - continues to ramp up towards full production capacity of 80m tonnes pre annum.

Iron ore accounted for approximately 53.5% of FY22 earnings.

Coal (Metallurgical and Energy)

Metallurgical coal production fell -1% compared to prior period as record wet weather conditions were offset by an inventory drawdown and the continued ramp up of truck fleets the Goonyella Project in Queensland.

"The near tripling of top end royalties by the Queensland Government remains a serious concern and threat to investment and jobs in that state," BHP said in a statement.

"In the absence of fiscal terms that are both competitive and predictable, we are unable to make significant new investments in Queensland."

Energy coal production plunged -38% after operations were hit by "more than three times the amount of rainfall than the prior year."

Coal-related earnings contributed 23.4% to FY22 earnings compared to 8.4% in FY21.

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Kerry Sun

Content Strategist

Kerry holds a Bachelor of Commerce from Monash University. He is an avid swing trader, focused on technical set ups and breakouts. Outside of writing and trading, Kerry is a big UFC fan, loves poker and training Muay Thai. Connect via LinkedIn or email.

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