January 20, 2020 / 11:39 PM / a month ago

BHP maintains FY iron ore, thermal coal forecasts despite bushfire impact

(Reuters) - BHP Group (BHP.AX) (BHPB.L), the world’s biggest miner, on Tuesday maintained its full year iron ore and thermal coal output forecasts, despite production of the latter being hit by the Australian bushfires.

New South Wales thermal coal output fell 11% in the first half to 7 million tonnes, BHP said in its December quarter production report, but maintained its full year forecast of between 15-17 million tonnes.

“We are monitoring the situation and if air quality continues to deteriorate then operations could be constrained further in the second half of the year,” the company said in a statement.

The global miner joined a growing list of companies dealing with the impact of the devastating fires that have scorched an area roughly a third of the size of Germany since September.

Elsewhere, BHP reported that Australian iron ore output was 68 million tonnes for the three months ended Dec. 30, nearly 2% lower than in the September quarter and slightly below a UBS estimate of 69.3 million tonnes.

It was, however, 3% higher than a year ago and with car dumper maintenance work in October now finished, BHP maintained its full year iron ore forecast of 273 million tonnes to 286 million tonnes.

“It was pretty much in line across the board … perhaps a little bit weaker on coal for the quarter,” UBS analyst Glyn Lawcock in Sydney said of the production report.

Copper output rose 6% to 455 kilotons from the end of September as higher throughput offset disruptions to the world’s largest copper mine, Escondida, following social unrest in Chile.

Planned maintenance at Kwinana refinery and Kalgoorlie smelter also weighed on BHP’s nickel output in the quarter.

Reporting by Nikhil Kurian Nainan in Bengaluru, additional reporting by Melanie Burton in Melbourne; Editing by Daniel Wallis and Jane Wardell

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