BHP Billiton chief executive Andrew Mackenzie has signalled that China may have turned a corner, saying he had shifted from a slight “bear” on the world’s second largest economy three months ago to once against siding with the China “bulls”.
Mr Mackenzie, speaking in Washington, said BHP’s key commodities including iron ore, coal, copper and oil were “still flowing” through Chinese ports and there was no inventory build-up.
“If we compare to three or four months ago, things are a little better, not worse,” Mr Mackenzie said after delivering a speech to the US Chamber of Commerce.
BHP’s business activity offers a sneak peak into key sections of the Chinese economy, because the miner is a large supplier of commodities used to construct buildings, bridges, cars and other metals-intensive objects.
A range of recent disappointing economic data suggests Australia’s biggest export market may be slowing faster than most economists had anticipated.
The share prices of mining companies such as BHP and Rio Tinto have fallen in recent weeks, amid falling commodity prices, a devaluation of the yuan and a Chinese stock market plunge.
After a partial recovery in the price of iron ore in recent weeks, Mr Mackenzie admitted there was more “downside” to the iron ore price due to the volume of new production coming on stream.
“The price risk is slightly to the downside,” Mr Mackenzie said.
Iron ore for January delivery on the Dalian Commodity Exchange, the most traded contract, closed down 3.2 per cent at to $US62 a tonne, Reuters reported Wednesday.
For the rest of this article, click here: http://www.afr.com/business/mining/bhps-andrew-mackenzie-more-bullish-on-china-20150916-gjoh1n