© Reuters.
Investing.com — BHP Group (NYSE:) (ASX:), the world’s largest miner, said on Thursday that its fourth-quarter iron ore production inched higher from a year ago, while weakness in major market China also saw sales of the steel-making product weaken.
Total production of its Western Australian iron ore reached 72.7 million tonnes (mt) in the quarter to June 30, up from the 71.7 mt seen in the same period last year, the Anglo-Australian miner said in a release. The production figure missed estimates of 73 mt carried by Australian media.
Total iron ore production for the year to June 30 rose to a record-high 285.3 mt, compared to 282.8 mt seen in fiscal 2022.
But iron ore sales declined during the quarter to 71.2 mt from 72.8 mt last year, bringing annual sales down to 280.7 mt from 283.9 mt a year ago. Annual sales were at their weakest level in four years.
The firm also saw an 18% decline in average realised prices on its iron ore sales through fiscal 2023, likely indicating weakness in its annual earnings, which are due in August.
BHP forecast iron ore production of 282 to 294 mt for fiscal 2024.
The miner is set to face increased earnings pressure as China, its biggest market, struggles to stage an economic recovery. Weakness in China has battered global metal prices, and also severely tightened the margins of major iron ore miners.
BHP peer Rio Tinto Ltd (ASX:) earlier this week posted weaker iron ore shipments in the June quarter, and also warned that a global economic slowdown could stymie metal demand this year.
BHP, which recently completed the acquisition of miner Oz Minerals, said annual copper production rose 9% to 1.7 mt. But average realised prices on copper sales fell 12% through the year, despite a mild recovery in the fourth quarter.
Weakness in metal prices, coupled with softer demand in China, is expected to have weighed on BHP’s margins through fiscal 2023. The firm is set to report its annual earnings on August 22.
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