BHP share price on watch after record-breaking FY24 iron ore production

The BHP Group Ltd (ASX: BHP) share price will be on watch on Wednesday.

That’s because the mining giant has just released its fourth quarter update.

Let’s see how the Big Australian performed during the three months ended 30 June.

BHP share price on watch following Q4 update

BHP revealed that iron ore production came in at 69Mt for the fourth quarter. This was up 13% from the third quarter. This was driven by record monthly and quarterly production at WAIO as a result of the strong underlying performance at the mines and the benefits of Port Debottlenecking Project 1. This underpinned iron ore sales of 68.4Mt for the quarter.

For the full year, BHP’s iron ore production increased 1% to a record 260Mt. Sales for the year rose 3% to 260.7Mt with an average realised price of US$101.04 per wmt. This is up 9% from US$92.54 per wmt in FY 2023.

Also growing quarter on quarter was BHP’s copper production. It reported production of 505kt, which was an 8% increase from the third quarter. This reflects higher concentrator grade and throughput at Escondida and record production at Carrapateena following the commissioning of Crusher 2 in the previous quarter.

For FY 2024, total copper production increased 9% to 1,865kt with an average realised price of US$3.98 per pound. The latter is up 8% year on year.

Elsewhere, metallurgical coal and energy coal production was down 18% and 10%, respectively, for the quarter. This reflects divestments and unfavourable weather.

This ultimately led to metallurgical coal falling 23% year on year. Whereas energy coal production still rose 8% from FY 2023.

Finally, nickel production was up 22% in the fourth quarter and 2% in FY 2024.

Management commentary

BHP’s CEO, Mike Henry, was pleased with the way the miner finished the year. He said:

We finished the year with a strong fourth quarter, achieving several production records and we are meeting current production and unit cost guidance for all commodities. WAIO continued its strong performance, delivering a second consecutive year of record production on the back of ongoing incremental improvements along its supply chain as we progress toward our medium-term goal of increasing production to greater than 305 Mtpa.

We achieved a strong performance across our copper business globally, underpinned by the highest production in four years at Escondida and another year of record production from Spence in Chile. Successful integration at Copper South Australia has delivered additional production tonnes, and exceeded the annualised synergies planned at the time of the OZL acquisition.

FY 2025 guidance

BHP sees potential for another record year of iron ore production in FY 2025. It is forecasting production of 255Mt to 265.5Mt.

In addition, copper production could be set for an increase in FY 2025. BHP is guiding to production between 1,845kt to 2,045kt.

The BHP share price is down 5% over the last 12 months.

The post BHP share price on watch after record-breaking FY24 iron ore production appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.