BHP (LSE:BHP) reported first-quarter copper equivalent production in line with market expectations and reiterated its full-year volume and unit cost guidance across all business divisions.
The first quarter is typically a softer period for the company due to scheduled maintenance. Copper equivalent output fell 7% quarter-on-quarter and 1% year-on-year, with sequential declines across all operations except Samarco.
Copper production outperformed expectations by 2% and now sits 3% above the midpoint of FY26 guidance, supported by record mill throughput at Escondida. Metallurgical coal production beat consensus by 6% and is 2% above forecast midpoints. In addition, Western Australia Iron Ore (WAIO) achieved realized prices equal to 91.7% of the benchmark, driven by higher lump ore volumes.
However, iron ore output came in 2% below consensus and 4% under Q1 guidance, reflecting car dumper maintenance. The Spence concentrator posted its weakest recovery rates since Q2 2022, resulting in a 10% volume shortfall. South American copper also lagged expectations by 10% due to maintenance at Olympic Dam, while thermal coal production was down 7% following scrubber maintenance.
In its market commentary, BHP noted that overall macroeconomic indicators for commodity demand remain firm, with global growth forecasts continuing to improve. While the company anticipates some moderation in economic activity during the second half of 2025, it still expects Chinese GDP growth of around 5% for the year. For copper specifically, supply disruptions at competing mines have tightened market fundamentals, supporting the company’s outlook.
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