BHP: Q3 iron ore output rises 3%, full-year outlook unchanged

BHP Group (BHP) reported that its third-quarter iron ore production rose 3% year-on-year to 69.8 million metric tonnes in the quarter ended March 31, and that the miner has kept its full-year guidance unchanged. The company noted that strong performance at its Western Australia operations offset disruptions to shipments caused by two tropical cyclones during the period.

On a 100% basis, output from BHP’s Western Australia operations amounted to 69.8 million tonnes, above the Visible Alpha estimate of 68.9 million tonnes and up from 67.8 million tonnes a year earlier. Despite higher volumes, realised prices for the steelmaking raw material fell about 2% to $85.35 per wet metric tonne for the quarter. Copper production also declined, slipping 7% to 476,800 tonnes in the same period.

The report highlighted operational resilience at Pilbara assets and reiterated that cyclones in February and March affected Port Hedland shipments but did not prevent a quarterly rise in production. BHP said it has concluded iron ore sales contract negotiations with China Mineral Resources Group (CMRG), a development markets have watched closely after earlier procurement restrictions. Outgoing CEO Mike Henry pointed to the group’s centralised procurement capability and low-cost operations as competitive strengths amid rising energy and consumable costs linked to broader geopolitical tensions.

Maintaining the Western Australia FY2026 production guidance range of 284–296 million tonnes on a 100% basis signals management’s confidence in meeting annual targets despite short-term weather-related disruptions and price volatility. For commodity markets, the mix of higher supply from a major producer and softer realised prices underscores the ongoing tug-of-war between resilient Australian exports and uncertain demand dynamics, particularly in China.

Analysts say market attention will remain focused on Chinese steel output trends, freight and port throughput post-cyclone, and any further shifts in realised iron ore prices that could pressure margins. While the resolution of sales discussions with CMRG may stabilise offtake in the near term, continued price weakness would likely weigh on BHP’s earnings and cash flow profiles even as production volumes remain supportive.