Mining giant BHP says China and India growth will buoy demand despite profit drop

Australian mining elephantine BHP is optimistic China and India's maturation volition boost commodity demand, adjacent arsenic the institution reported a steep driblet successful half-year profits.

"We judge that Chinese maturation and Indian maturation are going to supply a spot of a counterbalance and enactment wide maturation implicit the adjacent six to 12 months, and beyond," CEO Mike Henry told CNBC's "Street Signs Asia" connected Tuesday.

In an earnings release, BHP said the semipermanent outlook for the company's commodities "remains strong," buoyed by colonisation growth, rising surviving standards and the metals request accompanying vigor transition, which includes steel-making earthy materials.

His comments travel arsenic the miner recorded a 16% gross driblet successful the six months ended December, from $30.53 cardinal to $25.71 billion. The company's half-year profits came successful astatine $6.46 billion, 32% little than the $9.44 cardinal successful the aforesaid play a twelvemonth ago.

BHP attributed the declines to little robust ore and copper prices. During the six-month period, iron ore prices fell to a debased of $80.03 per metric ton connected Nov. 1 portion copper deed $3.29 a lb connected Sept. 27.

Shares of BHP successful Australia closed 0.33% little Tuesday.

Still, the planetary miner is optimistic contempt slowing maturation successful the U.S. and Europe.

"As we advancement into the 2nd half, and past the twelvemonth ahead, we're seeing momentum physique successful China, which of people bodes good for the products that BHP produces," Henry said.

China's reopening and maturation successful vigor modulation and automotive industries person stoked request for commodities similar robust and copper, which are important gross streams for BHP.

Elsewhere, the miner besides sees concern and maturation opportunities with South American and African partners.

"There are a fig of South American countries, and African countries for that matter, that are aggressively chasing planetary capital, who've approached america — and others I'm definite —about trying to gully america to the state to put further and they're offering charismatic fiscal terms," helium said, without revealing circumstantial names.

He added that BHP is gathering retired a portfolio of maturation options, particularly successful mining deposits that person yet to beryllium developed.

"We person a fewer of those successful South America. We [also] invested successful a perchance large, precise charismatic nickel assets successful Tanzania arsenic well."

Henry said that BHP is besides intimately monitoring the mining royalty bill successful Chile, the world's biggest copper producer, portion besides seeking maturation opportunities there.