Resources giant BHP Billiton has slowed the pace of its iron ore expansion by shelving a Port Hedland harbour project in a nod to weak prices.
There was no suggestion by BHP that it was in response to criticism it was causing a supply glut amid tumbling prices.
But the price has fallen by more than 60 per cent in the last year to decade lows of about $US50 a tonne, costing government coffers $30 billon over the next four years, according to Prime Minister Tony Abbott.
BHP on Wednesday actually lifted its iron ore production guidance for 2014-15 by five million tonnes to 250 million tonnes.
With three months to go, it had produced a record 188.2 million tonnes, beating March quarter expectations with shipments up 16 per cent to 64.2 million tonnes and production by 17 per cent to 64.4 million tonnes.
It said it can still get to 270 million tonnes a year using existing infrastructure, which will add to the cashflow worries for Australia's already struggling small and mid-tier iron ore miners.
"While this will lead to a slower path to system capacity of 290 million tonnes per annum, it will come at a lower capital cost," the company said.
No details were given about how much Wednesday's deferral of the inner harbour debottlenecking project will save, but it highlights how far iron ore prices have fallen since August 2012.
Back then, it was adopted as a cheap replacement when commodities were falling - but iron ore was still above $US100 a tonne - and so BHP ditched an outer harbour project estimated to cost up to $US20 billion.
BHP chief executive Andrew Mackenzie defended the company's massive iron ore expansions, which have been criticised by politicians and rivals such as Fortescue's founder Andrew Forrest for pushing down prices and reducing tax revenue.
"Over the last decade, China's unprecedented demand growth provided Australia and BHP Billiton with a unique opportunity," he said.
"We acted swiftly to bring on new iron ore capacity at some of the lowest costs globally, generating long-term value for shareholders, the government and communities which would otherwise have been lost to overseas competitors."
Fat Prophets resource analyst David Lennox said while BHP was probably not worried about Chinese demand long term, the project deferral reflected the reality of low prices and investors' views.
"They perhaps don't want to deliver too much more valuable iron ore into a low environment and so are slowing down," he told AAP.
Mr Mackenzie said BHP's margins were still attractive, with the group's breakeven price estimated to be about $US33 a tonne.
Petroleum production guidance was kept at 255 million barrels of oil equivalent, considered to be a solid result with drilling reduced in US shale and industrial action at Bass Strait.
That division, along with copper, increases in importance with iron ore's decline.
"Oil gives BHP so many other angles to play, so many other economies to be involved with because oil is demanded by the rest of the world," said IG market strategist Evan Lucas. "In the iron ore market you are really only selling to one major player."
BHP shares were 51 cents, or 1.7 per cent, down at $30.10 at 1540 AEST on a day the overall market was 0.7 per cent down.
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