UPDATE: BHP Misses Iron Ore Guidance, Met Coal, Oil Strong
July 21 2009 - 8:32PM
Dow Jones News
BHP Billiton Ltd. (BHP.AU) Wednesday posted fourth quarter iron
ore output of 27 million metric tons, down 10% on year after a
series of accidents affected production.
Macquarie analyst Brendan Harris said that the weaker iron ore
output was roughly in line with expectations and that the fourth
quarter production figures were "solid" overall, with strong
showings from metallurgical coal and petroleum.
BHP said safety initiatives had affected the fourth quarter iron
ore production and that the tie in of its Rapid Growth Project 4
expansion project was set to continue to impact output.
Total iron ore production for the year from BHP's mines in the
Pilbara region of Western Australia state on a 100% basis was 124.8
million metric tons, below previous guidance for 130 million
tons.
BHP Iron Ore President Ian Ashby had warned in May that the iron
ore output was likely to come in "a few million tons short" of the
guidance due to disruptions caused by a series of accidents at the
miner's operations.
Copper production for the quarter fell 21% on year to 307,200
tons and BHP said provisional pricing impacts on the red metal were
set to decrease earnings by US$936 million.
Petroleum output for the quarter rose 4% on year to 37.56
million barrels of oil equivalent as new projects boosted
production.
BHP said metallurgical coal output rose 4% on year to 9.5
million metric tons due to stronger demand conditions, particularly
from Asia.
Manganese ore output fell 32% to 500,000 tons.
Alumina production fell 4% on year to 1.1 million tons for the
quarter and aluminum dipped 5% to 310,000 tons partly on power
shortages in South Africa.
BHP said that commodity prices would be influenced by supply
responses to the downturn and that, in the short term, underlying
demand trends are being masked by de-stocking and restocking
activities.
"China inventory build is essentially complete, while we are now
seeing evidence that restocking has commenced in North America,
Europe and Japan," BHP said.
-By Alex Wilson, Dow Jones Newswires; 61-3-9292-2094;
alex.wilson@dowjones.com