BHP sees China driving iron ore demand this year

BHP reported record first-half iron ore production and said it expected China to drive commodity demand this year as it opened up from stringent Covid restrictions.

The world's biggest miner produced a record 132 million tonnes of iron ore in the six months to December 31 via a strong supply-chain performance.

“China’s pro-growth policies, including in the property sector, and an easing of Covid-19 restrictions are expected to support progressive improvement from the difficult economic conditions of the first half,” said BHP boss Mike Henry.

“BHP believes China will be a stabilising force when it comes to commodity demand in the 2023 calendar year, with OECD nations experiencing economic headwinds."

BHP left full-year iron ore production forecasts unchanged for 2023, but warned copper output would be at the low end as a result of constraints at the Escondida mine in Chile - the world's biggest - which has been hit by industrial action.

Metallurgical coal production would also be at the low end of guidance due to wet weather in north-eastern Australia, BHP said.

Reporting by Frank Prenesti for Sharecast.com