South32 delivers mixed alumina and stable aluminium results amid Q3’26 market shifts

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Leading Australian mining and metals company South32 posted its January-March (Q3) quarterly update, reporting a stable performance throughout the quarter in its aluminium sector and a slight upward spike in the alumina segment.

Commenting on the quarterly performance, Graham Kerr, the South32 Chief Executive Officer, stated, “Our teams delivered several strong operating results in the March quarter, despite adverse weather impacts.”

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Q3 performance study: Alumina

Worsley Alumina showed a saleable output, despite a temporary dip in plant availability and interruptions in third-party gas supply following Tropical Cyclone Narelle, held fairly steady throughout the three quarters for FY26. Full-year FY26 production guidance remains unchanged at 3.75 million tonnes.

• Comparing quarter-on-quarter (Q-o-Q), alumina production fell from 959 thousand tonnes in Q2 to 886 thousand tonnes in Q3, marking a 7.6 per cent difference. Sales in Q3 stood at 836 thousand tonnes, declining by 15 per cent from 985 thousand tonnes in Q2, mainly due to reduced product availability and shipment timing effects.
• Year-on-year (Y-o-Y) comparison between Q3 2026 and Q3 2025 shows a 5.84 per cent dip in production, i.e., 836 thousand tonnes in Q3 2026 from 941 thousand tonnes in Q3 2025. Similarly, sales plunged 8.13 per cent from 910 thousand tonnes in Q3 2025 to 836 thousand tonnes in Q3 2026.
• Year-to-date (YTD) nine-month record shows a slight decline of 0.43 per cent in production as it shifted to 2.78 million tonnes in the first nine months of 2026 from 2.79 million tonnes in the first nine months of 2025.

Although measures have been implemented to curb operating costs, aligning with market conditions, elevated global freight rates and higher caustic soda prices linked to the Middle East conflict are likely to put pressure on unit operating costs if these challenges continue.

Brazil Alumina reached a record 1.06 million tonnes for the nine months ended March 2026, supported by improved plant availability and operations running above nameplate capacity. FY26 production guidance remains unchanged at 1.36 million tonnes.

• A Q-o-Q comparison of Q3 and Q2 shows a minor 1 per cent decline in production from 355 thousand tonnes in Q2 to 351 thousand tonnes in Q3. Sales fell by 14 per cent from 387 thousand tonnes in Q2 to 333 thousand tonnes in Q3, mainly due to inventory drawdowns in the previous quarter and shipment timing variations.
• Comparing Y-o-Y, production surged 8 per cent from 324 thousand tonnes in Q3 2025, while sales edged up 3 per cent, rising from 323 thousand tonnes in Q3 2025.
• Nine months YTD analysis reported a 5 per cent rise of 54 thousand tonnes in production to 1.06 million tonnes for the first nine months of 2026, compared to the 1 million tonnes for the first nine months of 2025.

Despite strong operational performance, elevated global freight rates and higher caustic soda costs, driven by the Middle East conflict, are likely to weigh on unit operating costs if these pressures continue.

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Q3 performance study: Aluminium

Brazil Aluminium delivered a stable performance, consolidating the nine months of FY26. FY26 production guidance remains unchanged at 135 thousand tonnes. Following pot outages and power disruptions in December 2025, the operator has taken steps to enhance process stability. As a result, all three potlines showed improved stability and output by the end of Q3.

• A Q-o-Q comparison between Q3 and Q2 depicts that production declined by 11 per cent from 37 thousand tonnes in Q2 to 33 thousand tonnes in Q3. Sales dropped sharply by 40 per cent from 45 thousand tonnes to 27 thousand tonnes, largely due to shipment timing and prior inventory adjustments.
• On a Y-o-Y basis, production decreased by 8 per cent from 36 thousand tonnes in Q3 2025 to 33 thousand tonnes in Q3 2026, while sales fell by 13 per cent from 31 thousand tonnes to 27 thousand tonnes.
• Nine-month YTD performance indicates a 7 per cent increase in production, rising from 100 thousand tonnes in the first nine months of 2025 to 107 thousand tonnes in the first nine months of 2026, while sales grew 10 per cent from 92 thousand tonnes to 101 thousand tonnes.

Hillside Aluminium maintained a stable performance, testing its maximum technical capacity, even with power outages at the smelter.  FY26 production guidance
stands at 720 thousand tonnes, the same as in the previous quarter.  

• Comparing Q-o-Q, production declined by 3 per cent from 181 thousand tonnes in Q2 to 176 thousand tonnes in Q3. Sales slumped more sharply from 187 thousand tonnes to 158 thousand tonnes, reflecting a stark 16 per cent decrease, marked by weaker dispatch volumes and possible inventory adjustments.
• The Y-o-Y comparison depicts a rise in production, i.e., up by 1 per cent from 175 thousand tonnes in Q3 2025 to 176 thousand tonnes in Q3 2026, while sales fell by 8 per cent from 171 thousand tonnes to 158 thousand tonnes.
• The YTD nine-month performance between the first nine months of 2025 and the same period of 2026 indicates that production remained broadly stable at 538 thousand tonnes compared to 537 thousand tonnes, while sales declined by 4 per cent from 538 thousand tonnes to 514 thousand tonnes.

Mozal Aluminium showed a dip in production during the first nine months of FY26 as the smelter was previously announced to be placed under care and maintenance, which was then implemented on March 15, 2026. The remainder of finished goods is to be drawn during the April-June quarter or Q4 2026.

• A Q-o-Q comparison shows that aluminium production dropped from 90 thousand tonnes in Q2 to 65 thousand tonnes in Q3, reflecting a sharp 28 per cent decline. In contrast, sales rose by 8 per cent to 67 thousand tonnes in Q3, up from 62 thousand tonnes in Q2, indicating improved offtake despite lower output.
• Analysing Y-o-Y, production fell significantly by 25 per cent from 87 thousand tonnes in Q3 2025 to 65 thousand tonnes in Q3 2026. Sales, however, declined at a slower pace of 7 per cent, easing from 72 thousand tonnes to 67 thousand tonnes.
• The nine-month YTD performance between the first nine months of 2025 and the same period of 2026 shows that production decreased by 6 per cent from 265 thousand tonnes to 248 thousand tonnes, while sales dropped by 7 per cent from 246 thousand tonnes to 229 thousand tonnes.

CEO Kerr highlighted the stable performance of South32, noting, “Hillside Aluminium continued to test its maximum technical capacity, capitalising on higher aluminium prices, while Brazil Alumina achieved record year-to-date production.” Emphasising the company’s resilience amid global market shifts, he added, “Our strong balance sheet leaves us well placed to manage short-term volatility in global markets.”

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