BHP Billiton misses full-year iron ore guidance

Global mining giant BHP Billiton has missed full-year iron ore production guidance by three million tonnes despite recording record levels at its Western Australia operations.

Fourth quarter output hit 56 million tonnes to push annual production three tonnes short of guidance at 257 million tonnes, the miner said on Wednesday, blaming a loss of output from it's Somarco joint venture in Brazil that halted production due to a dam burst in November.

The missed target comes after BHP had already cut guidance by 10 million tonnes in the third quarter due to a cyclone in WA's Pilbara region and accelerated maintenance on its rail line.

The miner now has a tough task if it expects to hit an increased 2017 production target of between 265 million tonnes and 275 million tonnes of iron ore, which is all expected to come from its Western Australia operations from the uptake of latent capacity.

"We expect volumes and costs across our minerals businesses to benefit from our continued drive to safely improve productivity," BHP Billiton chief Andrew Mackenzie said in a statement.

"We can create significant value through further cost reductions, taking advantage of latent capacity in our assets and investing in low-capital projects."

On a lighter note, BHP's petroleum division hit its mark, largely driven by reducing the U.S. onshore rig count to focus on cash flow while taking advantage of low offshore costs to ramp up the conventional deep-water exploration program.

BHP's copper and metallurgical coal businesses also beat guidance, and both are expected to grow by five percent and three percent respectively in fiscal 2017. Endit