Haulage Shortfalls Challenge Mineral Resources’ Onslow Iron Production Targets

Operational Challenges Prompt Guidance Revision

Mineral Resources Limited (ASX: MIN) has announced a downward revision to its volume guidance for the Onslow Iron project for the 2025 financial year. The updated forecast now sits between 7.8 and 8.0 million tonnes, reduced from the previous range of 8.5 to 8.7 million tonnes. This adjustment primarily stems from lower-than-expected availability of contractor road trains, which are critical for haulage operations, alongside fewer daily haulage cycles than targeted.

Haulage Constraints and Performance Metrics

The company reported actual contractor road train availability at 65 units, falling short of the 85 to 100 units initially targeted. Additionally, daily haulage cycles averaged 2.7, significantly below the 4.0 cycle target. Despite these setbacks, Mineral Resources’ own jumbo road trains have performed as expected, helping to maintain steady progress. These operational challenges have tempered the volume guidance but have not derailed the project’s overall trajectory.

Strong Shipment Growth Signals Momentum

May 2025 has seen a notable acceleration in shipments, with 1.7 million tonnes already dispatched and expectations to reach 1.9 million tonnes by month-end. This represents a substantial increase from April’s 1.3 million tonnes and equates to a run rate of approximately 23 million tonnes per annum. Daily loading rates have also improved, with several days exceeding 80,000 tonnes and a peak day hitting 100,000 tonnes loaded onto ocean-going vessels.

On Track for Nameplate Capacity by Early 2026

Looking ahead, Mineral Resources anticipates June shipments between 2.3 and 2.6 million tonnes, translating to a daily loading rate of 75,000 to 87,000 tonnes and a run rate of 28 to 31 million tonnes per annum. The company remains confident that the Onslow Iron project will achieve its nameplate capacity of 35 million tonnes per annum by the first quarter of fiscal year 2026. This confidence is bolstered by the commissioning of the fifth transhipper, MinRes Peak, at the Port of Ashburton, which will enhance transhipping capacity alongside the imminent arrival of an additional tug.

Strategic Implications and Investor Outlook

While the reduction in volume guidance highlights operational hurdles, the strong ramp-up momentum and infrastructure investments suggest that Mineral Resources is navigating these challenges effectively. The company’s ability to scale shipments rapidly despite haulage constraints will be a key factor for investors monitoring production and revenue forecasts. The ongoing investor and analyst tour of the Onslow Iron site underscores Mineral Resources’ commitment to transparency and engagement during this critical phase.