TOP NEWS: BHP hit by Covid labour crunch and wet weather in first half

(Alliance News) - BHP Group PLC on Wednesday released some uninspiring production figures, with ...

Alliance News 19 January, 2022 | 8:09AM
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(Alliance News) - BHP Group PLC on Wednesday released some uninspiring production figures, with everything from maintenance issues to Covid-induced labour shortages to wet weather hurting output in its first half.

BHP shares ended 0.3% lower at AUD46.56 in Sydney on Tuesday. In Johannesburg, the stock was down 1.0% to ZAR497.47. In London, it was up 0.4% at 2,424.00 pence.

In the six months to December 31, copper production fell 12% year-on-year to 742,000 tonnes while the metal's average realised price rose 30% to USD4.31 per pound. The fall in production was due to maintenance at Olympic Dam in Australia.

Iron ore production rose 0.8% to 129.4 million tonnes. The average price booked in the half was USD113.54 per wet metric tonne, up 9% to a year prior but down 28% compared to the six months ended June 30, 2021.

Metallurgical coal output slipped 8.0% in the half to 17.7 million tonnes compared to 2020's 19.2 million tonnes. Its realised price soared, however, multiplying to USD259.71 per tonne from USD97.61 a tonne.

Meanwhile, energy coal production came in at 7.2 million tonnes, rising 4.3% from 6.9 million. Thermal coal's price also rocketed, jumping to USD137.68 a tonne from USD44.35.

Nickel production sunk 15% to 39,300 tonnes from 46,200 tonnes, while the cost of the metal rose 30% to USD19,651 per tonne.

"BHP was fatality free at our operated assets for the third consecutive year. Our continuing focus on people and on operational reliability enabled us to achieve near record production in iron ore and to reduce the impacts of adverse weather and Covid-19 related labour constraints in our operations," Chief Executive Mike Henry said.

Looking ahead, BHP left its financial 2022 production guidance unchanged for iron ore, energy coal and nickel. But the miner lowered its metallurgical coal guidance to between 38 and 41 million tonnes from 39 to 44 million.

BHP also said its copper production outlook is trending towards the low end of its guidance range, which was set between 1.6 and 1.8 million tonnes.

By Greg Roxburgh;

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