BHP’s (ASX:BHP) iron ore production drops amid labour shortage

• BHP Group (BHP) is tabling its latest quarterly report, showing iron ore production slipped by 3 per cent amid a shortage of available labour
• The mining giant revealed its coal, copper and nickel production also fell during the three month period, though the shortage is attributed to planned maintenance
• Despite the slip in the above totals, BHP says its production and unit cost guidance remain unchanged for the 2022 financial year
• The company ended months of speculation when it announced a petroleum assets merger with Woodside (WPL)
• BHP shares are down 1.71 per cent at $38.52 per share at 12:37 pm AEDT

BHP Group’s (BHP) iron ore production has slipped by 3 per cent amid a shortage of available labour.

The mining giant released its latest quarterly report today, showing COVID-19 border restrictions impacted the company’s ability to produce iron ore.

A total of 63.3 million tonnes of iron ore was produced during the quarter, 3 per cent down on the June period’s performance and a 4 per cent drop compared to last year’s result.

BHP’s metallurgical and energy coal, copper and nickel production also fell during the three month period, though the shortage is attributed to planned maintenance.

Metallurgical coal suffered the biggest slump, dropping 25 per cent quarter on quarter, while nickel decreased 21 per cent, energy coal 6 per cent and copper 7 per cent.

Despite the slip in the above totals, BHP said its production and unit cost guidance remained unchanged for the 2022 financial year.

BHP Chief Executive Officer Mike Henry said he was pleased to report the maintenance was progressing well.

“BHP’s operations delivered reliably during the first quarter and we completed planned major maintenance activities across a number of our assets. We continue to skilfully navigate the ongoing challenges of COVID-19,” Mr Henry said.

“We progressed the ramp-up of production of high quality iron ore at South Flank and copper from the Spence Growth Option, and we delivered first nickel sulphate from our new plant at Kwinana.

“We sanctioned the Jansen Stage 1 potash project in Canada, and made a series of targeted investments in copper and nickel exploration in Australia and Canada.”

The company’s biggest announcement for the period was its petroleum assets merger with Woodside (WPL).

BHP ended months of speculation when it confirmed in August it was in the process of transferring its oil and gas assets in exchange for WPL shares.

Following today’s production slip announcement BHP shares had fallen 1.71 per cent to $38.52 at 12:37 pm AEDT.