Australia: BHP records higher coking coal output, lower thermal production in Q1FY’26

• Coking coal up 8% y-o-y to 4.87 mnt; guidance intact
• Thermal coal output down 4%; Mt Arthur extended to CY’30

Mysteel Global: BHP, the Australian multinational mining and metals group, recorded 4.87 million tonnes of coking coal production (BHP share 50%) during July-September, the first quarter of Australia’s fiscal year 2025-26 (Q1 FY26), according to the company’s quarterly report released on October 2. The total marked an 8% increase from the same quarter last year.

The growth was mainly attributed to higher production rates at the Broadmeadow mine in Queensland and increased prime stripping. Broadmeadow is a longwall underground operation whose output is processed jointly with coal from the Goonyella Riverside opencast mine. Coal production from the Goonyella cluster surged 38% y-o-y to 1.88 mnt during the quarter, the report noted.

However, compared with the previous April-June quarter, Q1 output slipped 5.5% from 5.15 mnt likely due to the company’s decision to mothball the Saraji South section of the Saraji mine complex also in central Queensland. BHP said the mine would enter a period of “care and maintenance” from November – a term referring to operations placed on hold, while reports indicated workforce reductions had already begun months earlier.

According to the report, Saraji’s coking coal production in Q1 reached 884,000 tonnes, down from 940,000 tonnes in Q1 FY25 and from 1.08 million tonnes in Q4 FY25.

“Production guidance for FY26 remains unchanged at 18-20 million tonnes (36-40 million tonnes on a 100% basis),” BHP stated.

Coking coal sales over July-September totalled 4.47 million tonnes, up 5% YoY but down 11.1% QoQ, the data showed. The average realized price for coking coal stood at $180.67/t, down 16% from $214.86/t a year earlier.

For thermal coal (referred to as ‘energy coal’ in BHP’s report), Q1 output totalled 3.5 million tonnes, down 4% YoY and 13.5% QoQ.

“Production decreased due to additional wash plant maintenance, which reduced plant throughput,” BHP explained. “However, strong mining performance and improved truck availability led to a build-up of raw coal inventory.”

Despite the quarterly decline, BHP maintained its FY26 production guidance for thermal coal at 14-16 million tonnes.

Sales reached 3.71 million tonnes over thew quarter, also down 6% YoY and 5.6% QoQ, while the average realized price slumped 23% YoY to $95.18/t, the report showed.

Last month, BHP had received final approval from the Australian Federal Government to extend operations at its Mt Arthur Coal open-cut mine – the key asset under its New South Wales Energy Coal (NSWEC) unit wholly owned by BHP – for an additional four years, through to June 30, 2030.

Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.