BHP copper output falls 19%, misses analyst estimates
Key Facts
BHP Group reported copper production of 400.7 thousand tonnes for the first quarter of its 2027 financial year, ended September, in its operational report released on 20 October 2026. Output fell 19% both from the same period a year earlier and from the previous quarter, the company said. Production missed the average analyst estimate compiled by Visible Alpha of 423,600 tonnes, according to Reuters. Nevertheless, the group maintained its copper production guidance for the 2027 financial year at between 1,650 and 1,800 thousand tonnes. Its shares fell as much as 2.4% following the report, according to Reuters coverage published the same day.
At Escondida, copper production on a whole-mine basis totalled 252.6 thousand tonnes during the quarter, down 23% year on year, according to the operational report. The copper grade of ore fed to the mine's concentrators fell to 0.81%, from 0.94% in the corresponding period of the previous financial year. At Spence, concentrator feed grades also declined, to 0.53% from about 0.65% a year earlier. The company said Spence's operations continued to face difficulties handling variability in ore characteristics. On labour relations, a new collective agreement with Escondida's supervisors' union took effect for 36 months from 14 October 2026.
At Carrapateena, BHP said it replaced the conveyor and returned it to operation within 7 weeks. It added that the conveyor was operating at full capacity after replacement and restart work was completed during the quarter ended September. For copper sales, the average realised price rose to $7.01 per pound, from $4.59 per pound in the corresponding period of the previous financial year. The average realised selling price increased 53% year on year, according to figures in the group's operational report. In iron ore, the company reported a 4% annual increase in production, bringing quarterly output to 66.5 million tonnes.
The quarterly results follow a financial year in which the company said in its review published in July that it produced about 2 million tonnes of copper. It was the second consecutive year in which the group's annual production reached roughly that level. Annual results announced in August showed copper contributed more than half of the group's underlying earnings before interest, taxes, depreciation and amortisation. Chief Executive Brandon Craig said when those results were announced that the company's projects could increase copper production by about 40% by the 2035 financial year. The group says its copper growth programme is "fully self-funded at consensus price levels".
In its assessment of the demand environment, BHP's management said industrialisation and urbanisation in China and India were supporting resilient commodity demand. It identified geopolitical tensions and trade uncertainty as continuing pressures on the mining sector. Higher energy and freight costs were also putting pressure on the sector, it added, according to the statement accompanying the operational report. Over the longer term, the group expects copper demand linked to data centres to rise about 6 times between 2024 and 2050. According to company estimates presented as part of its copper growth programme, demand linked to this activity could reach about 3 million tonnes annually by 2050.
On investment, BHP announced approval of $0.8 billion in advance funding for the new concentrator at Escondida, on a whole-project basis. The funding is allocated to support engineering, permitting and preparations for project execution, according to the quarterly report. At the Jansen potash project, the group said stage one was 87% complete, according to its operational update released in October. The company's next corporate event is its annual general meeting, scheduled to take place in Sydney on Thursday, 22 October 2026. The company set the meeting's start time at 10 a.m. Sydney time, according to its meeting announcement.