Commodities Buzz: BHP Billiton Iron Ore Production Increases By 2% In Nine Months Ended March 2018

BHP Billiton came out with its production report for the nine months ended 31 March 2018. The company stated that total iron ore production for the nine months ended March 2018 increased by two per cent to a record 175 Mt, or 203 Mt on a 100 per cent basis. Guidance for the 2018 financial year has been reduced to between 236 and 238 Mt, or between 272 and 274 Mt on a 100 per cent basis reflecting car dumper reliability issues as push to record levels of production.

At WAIO, increased production was supported by record production at Jimblebar and Mining Area C, and improved rail reliability. This was partially offset by the impact of lower opening stockpile levels following the Mt Whaleback fire in June 2017, planned maintenance and port debottlenecking activities in the first half of the financial year. Volumes decreased by six per cent from the December 2017 quarter reflecting impacts from Cyclone Joyce and unplanned car dumper maintenance, despite improved rail reliability and an increase in peak performance in the number of rakes per day.

With the system constraint now at the port, a program of work is underway to improve car dumper availability and performance. On 16 February 2018, BHP received regulatory approval to increase capacity at its Port Hedland operations to 290 Mtpa (100 per cent basis) and expects to reach this run rate by the end of the 2019 financial year. Mining and processing operations at Samarco remain suspended following the failure of the Fundn++o tailings dam and Santarn++m water dam on 5 November 2015.