Anglo-Australian mining giants BHP Group and Rio Tinto cut iron ore production in the third quarter, hit by a worker shortage resulting from coronavirus travel restrictions.

Western Australia, home to the iron ore mines for both industry behemoths, experienced a personnel squeeze as the travel restrictions kept mining workers from entering. Many of these employees fly in to the work sites from outside the state for a period of time.

BHP’s iron ore output in Australia declined 5% to 70.6 million tons for the July-September term, the company reported Tuesday, citing “planned major maintenance activities” as a factor.

The miner also noted “temporary” labor shortages for rail carrying iron ore to ports due to restrictions on travel across state borders. Iron ore production guidance for the full year through June 2022 remained between 278 million tons and 288 million tons.

Rio Tinto’s Australian iron ore output fell 4% on the year to 83.3 million tons for the quarter.

The July-September period “has been another difficult quarter operationally, and despite improving versus the prior quarter, we recognize the opportunity to raise our performance,” CEO Jakob Stausholm said.

Rio Tinto downgraded its forecast for Australian iron ore shipments to between 320 million tons and 325 million tons for 2021, from earlier guidance of 325 million tons to 340 million tons as of July, due to “modest delays” in mine development stemming from “the tight labor market in Western Australia.”
Source: NIKKEI Asia