Global miner BHP posted on Thursday a 4% year-on-year growth in its copper production in the first quarter of financial year 2025, beating expectations.

The strong operational performance was driven by higher concentrator feed grades and recoveries in Escondida, Chile, Kallanish learns. Q1 production came in at 476,300 tonnes of the red metal, with Escondida accounting for 304,200 t and an 11% on-year increase.

In addition to the volume boost, BHP also enjoyed a 17% rise in the average realised price of copper at $4.24/lb, from $3.63/lb in Q1 FY24.

Describing the quarterly results as a “strong start to the year,” chief executive Mike Henry notes Beijing’s recent move is likely to be good news for commodities, particularly copper.

“China has announced a series of monetary easing policies in an effort to support economic growth, and has indicated more significant fiscal stimulus is on the horizon,” he says. “Upcoming stimulus is likely to focus on relieving local debt, stabilising the property market and bolstering business confidence.”

The company expects fundamentals for the metal to remain strong thanks to traditional economic growth, electrification, energy transition and digital infrastructure. Predicting global demand will grow by 70% by 2050, the miner plans to host an investor site visit in Chile next month. The idea is to outline its “attractive organic copper growth pipeline in the region,” it explains.

On the nickel front, production declined 3% y-o-y to 19,600 t, reflecting the temporary suspension of operations at Nickel West. The average realised price for nickel was 20% lower at $16,359/t.

While handover activities will be completed by December, BHP says it continues to support the workforce through this transition period. “We have made redeployment offers to a large portion of our frontline employees. We expect costs to remain elevated during the transition to suspension in the first half and we plan to invest about $300 million per annum beginning in January 2025 to preserve optionality for a potential restart,” it notes.

The miner has not provided production guidance for nickel, but expects to produce 1.18-1.30 million t of copper in FY25. The bulk of it will be achieved in the second half of the year.

Jefferies says that BHP’s Q1 copper production beat both consensus and its estimates. “BHP is pivoting hard to organic growth in copper,” analysts say, adding the metal is “one of our preferred commodities for the remainder of this decade.”