Global miner Anglo American (LON: AAL) ended 2018 on a high note, posting strong fourth quarter production results on Thursday despite setbacks at its iron ore operations in both South Africa and Brazil.
Output of copper, one of the miner's main commodities, reached a five-year high, with overall output for the last quarter of 2018 rising 7% as a result of operational changes that boosted efficiency, the company said.
Copper production reached a five-year high, more than offsetting output declines at Minas Rio in Brazil and Kumba in South Africa.The significant increase in copper production - 23% higher than the same quarter a year ago - more than offset a 13% production decline at Kumba iron ore in South Africa, attributed mostly to infrastructure problems.
Disruptions at Anglo's giant Minas Rio iron ore mine in Brazil also weighed on the miner's production figures, with output for the steel-making ingredient in the last three months of 2018 coming at 10.2 million tonnes, down 13% from the previous year and 4% when compared to the third quarter of 2018.
Operations at Minas Rio, Anglo's biggest development project, were shut down for eight months following the discovery of leaks in a pipeline that carries ore to a port in Rio de Janeiro for export.
Looking ahead, Anglo American guided for Kumba to produce 43 million to 44 million tonnes of iron ore this year, and Minas Rio 18 million to 20 million tonnes.
Diamonds giant De Beers' output increased 12% to 9.1 million carats due to production increases at Orapa. But full-year rough diamond sales fell by 4% to 33.7-million carats, with a consolidated average realized price of $171 per carat because of reduced sales of lower-value diamonds.
De Beers' full-year rough diamond sales fell by 4% to 33.7-million carats, with a consolidated average realized price of $171 per carat because of reduced sales of lower-value stones.The division's expected output this year was pegged at between 31-million and 33-million carats as the company moved production underground at its Venetia mine in South Africa, in a $2 billion-project.
"Associated with this, an increased proportion of production in 2019 is expected to come from De Beers Group's joint venture partners, a proportion of which generates a trading margin, which is lower than the mining margin generated from own mined production," Anglo said.
In terms of spending in exploration and evaluation, Anglo reported a 25% increase in 2018, equivalent to $284 million, with the bulk of that expenditure going to the assessment of building an underground mine at its Los Bronces copper mine in Chile.
Elsewhere, metallurgical coal production increased by 15% to 5.6 million tonnes in the quarter, driven by productivity improvements at Moranbah and the continued ramp up at Grosvenor. The total production for the year grew 11% to 21.8 million tonnes.
Thermal coal production, however, fell 9% to 6.9 million tonnes in the quarter and dropped 2% in the year to 28.6 million tonnes due to the impact of rain at Cerrej??n.
For this year, Anglo expects to produce between 22 and 24 million tonnes of steelmaking coal and 26 to 28 million tonnes of the thermal kind.