BHP raises iron ore production estimate

BHP has raised its iron ore production target for its full-year after restarting a mining operation in Brazil.

The miner on Wednesday gave a half-year production update in which it said it would produce between 245 and 255 million tonnes of iron ore.

The company in December restarted the Samarco joint venture, five years after a dam collapsed and killed 19 people in Brazil’s biggest environmental disaster.

BHP and Brazilian miner Vale have 50 per cent stakes in Samarco.

Chinese steel-makers’ demand for iron ore has been key to miners’ profits.

The iron ore price has climbed from a little more than $US80 per tonne last year, to $US172 per tonne, based on China port data.

The commodity accounts for about 40 per cent of BHP’s business.

Full-year production guidance for copper was narrowed to between 1,510 and 1,645 thousand tonnes following better performance of the Escondida mine in Chile.

The target for energy coal was lowered to between 21 and 23 million tonnes after workers went on strike for 91 days over pay and conditions at the Cerrejon mine in Columbia.

There was no change for petroleum or metallurgical coal. The petroleum target is between 95 and 102 million barrels of oil equivalent, while the metallurgical coal one is between 40 and 44 million tonnes.

Shares were higher by 1.47 per cent to $46.54 at 1340 AEDT.

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