Industry News

BHP Confident China Property Recovery Will Boost Metals Demand

Views : 26
Update time : 2023-05-25 21:30:03

BHP Group Ltd. is confident China’s troubled property market will turn around in coming months, despite gloomy economic signals pushing iron ore and copper prices back to levels last seen during the Covid Zero era.

Secondary sales in the housing market “continue to be strong, very strong,” Vandita Pant, BHP’s chief commercial officer, said in an interview on Thursday. “We always thought sales and completions of homes will turn around first, and then new starts,” she said, adding “that trajectory is holding.” 

The note of confidence from the world’s biggest miner comes after China’s economic activity disappointed expectations since strict pandemic restrictions were removed late last year, heavily impacting metals demand. The Asian powerhouse is by far the largest importer of both iron ore and copper. 

Weaker-than-expected construction, particularly in the property sector, has pushed iron ore — BHP’s top export — below $100 a ton. Copper, another of its key commodities, fell below $8,000 a ton for the first time in six months this week, adding to broader gloom about the global economy. 

But Pant said BHP still expects China’s metals demand “to be a source of stability in the second half, and the second half to be better than the first half,” echoing the words of Chief Executive Officer Mike Henry at the company’s half-year results in February. 

The first quarter of 2023 was “better than we were expecting,” but the market got carried away in the second quarter, pushing commodity prices to unrealistic levels, Pant said. China’s economy wouldn’t feel the “full tailwind” of government stimulus measures, introduced earlier this year, until 2024, she said. 

Copper futures on the London Metals Exchange edged up 0.4% to $7,929 a ton at 12:22 p.m. in Singapore, but are still down almost 4% this week. 

Related News
Read More >>
Vale USA selected for iron ore briquette plant construction in US Vale USA selected for iron ore briquette plant construction in US
Mar .27.2024
Vale USA selected for iron ore briquette plant construction in US
China’s coking coal imports kike in Jan-Feb China’s coking coal imports kike in Jan-Feb
Mar .27.2024
China’s coking coal imports kike in Jan-Feb
China’s social stocks of 5 major steel products in week ending Mar 22 decrease China’s social stocks of 5 major steel products in week ending Mar 22 decrease
Mar .27.2024
China’s social stocks of 5 major steel products in week ending Mar 22 decrease
Taiwanese stainless steel wire rod manufacturers keep cautious attitude for April new rates Taiwanese stainless steel wire rod manufacturers keep cautious attitude for April new rates
Mar .27.2024
Taiwanese stainless steel wire rod manufacturers keep cautious attitude for April new rates