BHP's copper output misses forecasts after outages in Chile and Australia

what happened

BHP Group said on Tuesday that its copper production dropped 19% in the first quarter, coming in below what analysts had expected. Poor weather and a fatal accident that briefly halted work at Escondida, the largest copper mine in the world, weighed on the figures.

At Escondida in Chile, volume fell 23% to 252.6 thousand metric tons for the period ending September 30. Operations were suspended in late September after a worker died during maintenance. Separately, a breakdown of an underground conveyor at Carrapateena in South Australia cut output for several weeks.

Total copper output reached 400.7 kt, below the 423.6 kt Visible Alpha consensus and well under the 494 kt produced a year earlier, according to Reuters. Iron ore output in Western Australia rose to 71.9 million metric tons on a 100% basis, up from 70.2 Mt a year earlier. The company kept its full-year guidance unchanged across all operations.

why it matters

For copper markets, a supply shortfall at the world's largest copper mine tightens the balance and can add upward pressure on prices. Investors will also watch whether BHP keeps its full-year guidance after a weak quarter. Iron ore, by contrast, posted a modest gain.

market impact

Copper: the supply shortfall at Escondida is supportive for prices; BHP shares face pressure after the miss

tags

instruments