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BHP Billiton Limited (BHP)

  • Aug. 15, 2013, 1:51 PM
    • Workers began a surprise strike today at Chile's Escondida copper mine - the world's largest - to demand improved working conditions and pay; the work stoppage is planned to last 24 hours, but the miners union says the timeframe is being evaluated.
    • BHP Billiton (BHP +0.4%) and Rio Tinto (RIO -1.2%) each own 30% of Escondida, which produces ~20% of Chile's annual copper output; workers at BHP's Spence and Cerro Colorado mines also joined the labor action.
  • Aug. 9, 2013, 2:59 PM
  • Aug. 8, 2013, 10:29 AM
    • Reports of China's record-high imports of iron ore suggest worries about its future economic health and the impact on international mining companies may be overblown. (also)
    • "If you think in terms of strength in [overall] imports and strength in [iron ore and steel] prices, you can conclude [Chinese] steel demand is quite strong,” Macquarie says.
    • Iron ore prices have rallied in recent weeks as China has restocked supplies and increased steel output; although down ~9% YTD and well off 2011 highs, the index price for iron ore hit a three-month high $133.10/ton yesterday.
    • "As long as the developing world is continuing to urbanize and industrialize, our iron ore is going to be needed," Rio Tinto's (RIO +1.2%) Sam Walsh says.
    • CLF +4.5%, MT +4.3%, FCX +3%, BHP +3%, X +2.2%, VALE +1.6%.
  • Aug. 7, 2013, 9:13 AM
    • More from BHP CEO Andrew Mackenzie: BHP hasn't ruled out building the $14B Jansen potash mine in Canada, he tells WSJ, with prep work continuing even after the recent collapse of a producer cartel threatens to drive down potash prices. (earlier)
    • BAML analysts this week said the proposed mine "works" at prices above $400/ton but would struggle to generate a suitable return at $300.
    • Mackenzie says he remains optimistic about future demand for commodities in China despite a wobbly economy, with consumption-driven growth there to ensure strong demand for commodities such as gas, copper and potash.
    • Shares -0.6% premarket.
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  • Aug. 7, 2013, 4:27 AM
    • BHP Billiton (BHP) CEO Andrew Mackenzie has shrugged off the exit of Uralkali (URALL.PK) from one of world's two main potash cartels, saying that the latter's action was a short-term event while his company takes a long-term view.
    • "We've always said that potash is a business which will lose some of its cartel-like structure and become in time globally traded like everything else," Mackenzie said.
    • BHP will say more about potash when it presents its results on August 20.
    • There were rumors yesterday that Uralkali could re-form the cartel.
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  • Aug. 6, 2013, 10:31 AM
    • BAML urges BHP Billiton (BHP) to make a bold response to the implosion of one of the world’s two big potash cartels: Buy an established potash producer such as Mosaic (MOS) as an alternative to building the Jansen mine in Saskatchewan.
    • Jansen could eventually produce as much as 10M tons/year of potash, but likely will cost ~$15B to build. BAML says that’s on a par with its enterprise value of MOS, which could produce up to 12M tons/year; MOS also has a phosphate business worth as much as $8B that could be sold.
    • "Mosaic could provide instant critical scale via a large scale, low-cost, long-life asset," the firm says. (earlier)
  • Aug. 5, 2013, 3:42 PM
    • Potash (POT +2%) shares enjoy solid gains following remarks by Russian producer Uralkali’s CEO that consolidation would be a logical step for the sector when potash prices fall to a level of marginal producers, though it's too early to predict possible deals as the valuation of individual companies is now unclear.
    • Mosaic (MOS +1.2%) also is higher amid rumors it might be a takeover target for BHP Billiton (BHP +0.3%).
    • Agrium (AGU -0.5%) is left out of the gainers after shares are downgraded at Stifel Nicolaus.
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  • Aug. 4, 2013, 4:29 AM
    • Australian Prime Minister Kevin Rudd has called a general election for September 7, saying the poll will be about who can best lead the country "through the difficult new economic challenges which now lie ahead."
    • Rudd's Labor Party has reduced the lead of the right-of-center Liberal Party since Rudd deposed Julia Gillard as PM six weeks ago in an internal Labor coup.
    • The Liberals, led by Tony Abbott, have vowed to scrap mining and carbon taxes if they win the ballot, policies that would affect the likes of BHP (BHP), Rio Tinto (RIO), Peabody Energy (BTU), Vale (VALE), and Glencore (GLCNF.PK).
    • Relevant country ETFs include: Stocks - EWA, EWAS, KROO, AUSE, FAUS. Bonds - AUD, AUNZ; Forex - FXA, GDAY, CROC
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  • Jul. 31, 2013, 11:48 AM
    • Analysts widely expect the expected potash price war will bring an end to BHP’s $14B Jansen potash development project in Saskatchewan, but WSJ's Robb Stewart says maybe not.
    • BHP has never wanted to join a cartel, Stewart writes, preferring open market pricing like it was instrumental in driving for iron ore; had BHP succeeded with its 2010 bid for Potash (POT), it was planning to market its potash outside the Canpotex cartel.
    • The easiest choice for BHP may be to keep Jansen simmering in the background while working on getting the numbers for the project to add up and the potash industry adapts to the possible early arrival of market-based pricing.
  • Jul. 31, 2013, 7:58 AM
    • BHP Billiton (BHP) decides against selling its struggling Gregory Crinum coal mining operation in eastern Australia, saying recent operational improvements at the underground mine support continued operations.
    • BHP and Mitsubishi, which jointly own several coking coal mines in Queensland, in October closed the unprofitable Gregory open-cut mine, and has since closed the Norwich Park mine.
    • BHP says coal remains one of its core commodities even though investment will increasingly be directed toward U.S. shale oil production and iron ore mines in Western Australia.
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  • Jul. 30, 2013, 2:26 PM
    • The breakup of the Russian potash marketing cartel may signal the death knell for plans by BHP Billiton (BHP -1.8%) to spend as much as $15B to expand into production of the fertilizer ingredient.
    • While BHP has said it sees potash becoming the fifth pillar of its business in addition to copper, iron ore, coal and oil, it has delayed a final investment decision amid a freeze on new projects amid waning demand for raw materials.
  • Jul. 28, 2013, 2:27 PM
    • BHP Billiton (BHP) is betting strong returns from its copper business, even though copper prices are unlikely to rise in the near term, CEO Andrew Mackenzie says in an interview today.
    • The China shift to a consumer-led economy from a construction-led economy will reduce demand, but it might not be as bad as had been thought. "I don't like to comment on prices, but we have to prepare for a copper outlook around the current price, or perhaps a bit lower, that is around $3 per pound," he says.
    • Copper ETFs: JJC, CPER, CUPM
    • U.S.-traded copper miners: SCCO, FCX, TCK, GMO, SVBL, TLR
  • Jul. 26, 2013, 10:59 AM
    Iron ore miners are among the worst stock sectors YTD on worries about overcapacity and weaker demand from China, but some see the rout as overdone, with share prices of miners falling much more than market prices for iron ore. Miners are producing iron ore at $30-$50/ton, but supplied prices are averaging $90-$120/ton, says BlackRock's Evy Hambro, who has added to positions in diversified miners where iron ore is a key earnings driver.
  • Jul. 22, 2013, 5:30 PM
    South African coal producers including Anglo American (AAUKY.PK, AAUKF.PK) and BHP Billiton (BHP) have offered an "unacceptable" 5.6% wage increase that falls short of worker demands, the Solidarity labor union says. Last week, wage talks between labor and gold producers began with a proposed 4% pay hike rejected by the unions.
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  • Jul. 17, 2013, 3:17 AM
    BHP Billiton's (BHP) iron ore output rose 9% in FY 2013 to a record 187M tons, a figure that should grow this year as the company maintains plans to boost annual capacity to 220M tons by December. The increase in production at BHP, as well as at Rio Tinto (RIO), comes despite the slowdown in growth in China, a major export market. The strategy of the majors is to tighten their grip on the market and maximize economies of scale while other miners struggle. "As long as they keep margins well ahead of a declining iron ore price, they are winning," says analyst Gavin Wendt. (PR)
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  • Jul. 14, 2013, 1:59 AM
    New Australian Prime Minister Kevin Rudd plans to discard the country's carbon tax and introduce a less costly floating price emissions-trading system by July 1, 2014, a year earlier than planned. The scrapping of the tax, which was a flagship policy of ousted PM Julia Gillard, is expected to lower government revenues by several billion dollars, so it will have to cut costs to compensate. Companies that could be affected include Peabody Energy (BTU), BHP (BHP), Rio Tinto (RIO) and Glencore (GLCNF.PK).
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Company Description
BHP Billiton Ltd is a natural resources company. The Company is engaged in the producing commodities, including iron ore, metallurgical and energy coal, conventional and unconventional oil and gas, copper, aluminium, manganese, uranium, nickel and silver.