Anglo American cuts iron ore, diamond guidance

Anglo American cut its production guidance on Tuesday for iron ore, diamonds and coal.

In an investor update, the miner cut its forecasts for iron ore next year, in 2021 and in 2022 to between 42 and 43 million tonnes from previous guidance of between 43 and 44 million.

It now expects diamond production for next year to be between 32,000 and 34,000 carats, down from 33,000 to 35,000 previously. For 2021, its guidance was reduced to between 34,000 and 36,000 from between 35,000 and 37,000 carats.

Metallurgical coal production guidance was lowered to 21m to 23m tonnes from previous guidance of between 22m and 24m tonnes for next year. Guidance for production in 2021 was downgraded to between 22m and 24m tonnes from 23m to 25m tonnes previously. Guidance for 2022 was cut to between 25m and 27m tonnes from 26m to 28m tonnes.

Copper production guidance was nudged down to between 620,000 and 670,000 tonnes for next year from between 620,000 and 680,000, but guidance for 2021 was upped to 620,000 to 680,000 tonnes from 590,000 to 650,000.

Platinum guidance was trimmed to 21m to 23m ounces from 22m to 24m ounces for next year and to 22m to 24m from between 23m and 25m ounces for 2021.

Anglo said 2019 unit costs are expected to reduce by 5%, while total production volumes are expected to increase again. In addition, the company said it expects to meet a $3-4bn target of incremental annual EBITDA between 2017 and 2022.

Chief executive Mark Cutifani said: "We are building on the complete transformation of both the quality of our portfolio and our performance over the last six years. Anglo American is now amongst the very best in terms of our overall cost curve position as a result of fundamental operating changes, the technical and product marketing expertise we have applied, and the wholesale upgrade of our portfolio.

"We will continue to upgrade our asset portfolio over time and we see our progress continuing on all fronts as we also bring a number of high quality growth projects online during the next three years, delivering 20-25% production growth by 2023."

At 1345 GMT, the shares were flat at 2,078.50p.