BHP boosts iron ore production 15% to record high
Mining giant BHP Billiton has boosted its iron ore output by 15% in the three months to 30 June, despite worries over weaker demand from China.
Yearly iron ore output totalled 159 million tonnes, a 12th consecutive annual record, said the company.
Last month, BHP said that falling commodity prices and global uncertainty were a concern.
BHP has invested billions of dollars in its iron ore mining capacity in Western Australia's Pilbara region.
The company said iron ore shipments in the quarter from its Western Australia operations reached 40.9 million tonnes, compared with 35.5 million tonnes a year earlier.
The firm, which is the world's biggest miner, is betting on continued demand from its main customer, China.
The company said it was forecasting a 5% rise in production for 2013.
It is also due to decide this year whether to go ahead with a $20bn expansion that could see it nearly double its iron ore capacity in Western Australia from 2014.
Other major iron ore producers, Rio Tinto and Fortescue Metals, are also ramping up production but analysts are unsure global demand will hold up.
"Investors are going to place increased attention on the ability of the market to absorb supply increases, particularly at a time when profitability in the steel industry is negligible," said Tim Schroeders of Pengana Capital, which owns shares in BHP and Rio Tinto.
BHP shares fell 0.8% in morning trading in Sydney.