BHP reports stable Q1 production, maintains FY26 guidance

Investing.com -- BHP reported copper equivalent production in line with consensus for the first quarter of fiscal year 2026, while maintaining its full-year volume and unit cost guidance across all divisions.

The first quarter typically represents a seasonally soft period for BHP due to maintenance activities. Copper equivalent production declined 7% quarter-over-quarter and 1% year-over-year, with production decreasing sequentially in every division except Samarco.

Copper production exceeded consensus estimates by 2% and is tracking 3% above the FY26 guidance midpoint, supported by record mill throughput at Escondida. Metallurgical coal production surpassed consensus by 6% and is tracking 2% ahead of the midpoint guidance. Western Australia Iron Ore (WAIO) realized pricing improved to 91.7% of benchmark in Q1 due to higher lump volumes.

On the downside, iron ore production missed consensus estimates by 2% and tracked 4% below the guidance midpoint for Q1 due to car dumper maintenance. The Spence concentrator experienced its lowest recoveries since the second quarter of 2022, resulting in a 10% volume miss. Copper South America also missed consensus by 10% due to maintenance at Olympic Dam, while thermal coal production fell short by 7% because of maintenance at wash plants.

In its market outlook, BHP noted that overall macroeconomic signals for commodity demand remain resilient, with global growth forecasts moving higher. The company expects some deceleration in growth during the second half of calendar year 2025, but still anticipates Chinese GDP growth of approximately 5% for the year. In the copper market, BHP highlighted that major disruptions at competitors’ mines have tightened overall market fundamentals.

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