Agreed here. Plus China will come back to growth soon. This is a waiting game, however you can see the Chinese Government starting to react in the market place. Once the US Rate cut has been delivered, it will be good to see the Chinese Governments next move
BHP - BHP Group
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Looking at Iron Ore Prices they are trading relatively the same as in 2020, 2022 and 2023. The large spike in Iron Ore prices was only 2021. Under these prices was only from 2014 to 2018. BHP is a much large company now, its hard to see $18 AUD again. Once the Chinese Economy starts moving again, I would assume we would see the $50 AUD again.
Below is from Trading Economics at https://tradingeconomics.com/commodity/iron-ore
BHP is making more money now and will only increase when the world economy's and mainly China starts to normalise and grow again. I can understand that the Share Price may stay where it is until this happens, however I find it hard to see $18AUD again.
Chart from Macotrends https://www.macrotrends.net/stocks/charts/BHP/bhp-group/revenue
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Really, it has been slashed and slashed,
How much extra ground do they own?
As per ,
@finicky post previously: does anyone genuinely believe that extending reserves compensate extracted ones..unless you add new grounds,?
These extended reserves were already in the ground 10y ago, or 100y ago..olympic dam etc
Bhp was underpriced at some stages in the past indeed but
Bhp real size is shrinking day after day, only inflation could help their sp, or for a change putting money in the right sector, and buying something else than the latest fad at top of price before selling ut back for a bargain 5 y later
It might one day get proper management
But your cash so up to you
You are bearish on BHP.
If BHP is shrinking so rapidly how do they keep making more and more profit each year.
It will be good to watch BHP over the next 6 months to see what happens.
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Not 6 months, 2y
You can be shrinking and get more profit if your business is to sell a finite pile of stuff.
It is mining not crop growing or manufacturing
Extractive industry ...anyway i could be wrong indeed but would be nice to get some fundamentals if you invest a lot of your cash there for your own good
Mining is different
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i bought as low as $14.80 in 2016 , and i think that still included S32 and definitely still had the petroleum arm and QLD coal mines included
so depending on what the news is you would have to consider $10 as a possible floor
remember in a market panic , shareholders DO throw the baby out with the bath water
BHP is nice and liquid ( and held widely in BIG funds ) it would be a prime choice for someone with a debt/leverage problem
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Add inflation/ minerals $rises and my own target of $18 during the next slump
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but HOW are they making that profit .. Nickel West in moth-balls , the Petroleum arm gone , two massive coal mines ( and infrastructure ) gone and we aren't even talking over the last 5 years
remember BHP buys stuff looking for a profit with it in 5 to 10 years time ( OZ minerals seems to be the exception to that strategy )
profit increases by selling/closing losers can only last so long ( unlike a mine with a 10-20 year life time and expansion potential )
now i hold BHP and hope you are correct , but i am looking at them shrinking and shrinking and still trying to get the potash arm into profit after all these years and am not so optimistic
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copper and iron can slump pretty low , and the biggest buyer of uranium is China who we are liable to stumble into a war with ( nickel is already unprofitable for most )
remember the clowns don't just reside on the BHP board now , we have all sorts of clowns running the ( national ) asylum
Dona Ferentes
Abrió la caja, vio al gatito, y sonrió
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"Don't you love farce?
My fault, I fear
I thought that you'd want what I want
Sorry, my dear!
But where are the clowns
Send in the clowns
Don't bother, they're here"
My fault, I fear
I thought that you'd want what I want
Sorry, my dear!
But where are the clowns
Send in the clowns
Don't bother, they're here"
Never said Never to the Low price. If Depression hits Globally..argh..$18 Will look expensive too. Only my opinion.
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Flag me when it goes down past $20 and this clown will put the buy order
Regardless of what our opinions of China culture, rulings etc etc put the daily common whingeing aside,
We are talking about BUSINESS TRADE here, China is still one of the world top traders. We and the World still need China to do BUSINESS.
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but a different group still believe they can crush ( regime change ) China with sanctions and tariffs , and whether delusional or not , that different group think they control the world
remember that little catchphrase uttered widely a few years back ( including by Joe Biden ) 'build back better ' that implies near total destruction of existing infrastructure
would they REALLY do that ?
time will tell
but i am trying to craft a back-up plan just in case that group succeeds in the dream
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Ok I cheated and googled, but if you need reassurance about BHP's reserves and replenishment of attrition suggest you check out page 38 and onward of the annual report entitled 'Our Assets - Minerals.
But the google extract on Australian iron ore reserves generally (my emphasis):
Western Australia is the country's largest iron ore producing state, with an estimated 45.2Bt of economically demonstrated iron ore resource in 2021-22 and reserves with an average iron content of 53%, and can sustain production for another 56 years at 2021-22 production rates The state sent A$649m ($1,058m) on iron ore exploration in 2022, a 23% increase from the previous year.
Australian iron ore deposits have an average cut-off grade of 59.6% Fe content. These are used as direct feed to smelters, both as a raw lump or fines and in processed forms as sinter or pellets.
Hematite ore, also known as direct shipping ore, has Fe content in the range of 56-62%, and processing of this type of ore is relatively simple. Australia has a large, high quality hematite resource capable of producing low cost, direct shipping ore.
The future outlook for iron ore mining in Australia is bright, thanks to the country’s strong resource base and competitive advantage in transportation costs."
But the google extract on Australian iron ore reserves generally (my emphasis):
Australia’s iron ore reserves and production
Australia has the world’s largest crude ore reserves and iron content. The country had 51 billion tonnes (Bt) of crude ore reserves, accounting for 28.3% of the global total as of January 2023. Almost all of Australia’s iron ore reserves are located in Western Australia.Western Australia is the country's largest iron ore producing state, with an estimated 45.2Bt of economically demonstrated iron ore resource in 2021-22 and reserves with an average iron content of 53%, and can sustain production for another 56 years at 2021-22 production rates The state sent A$649m ($1,058m) on iron ore exploration in 2022, a 23% increase from the previous year.
Australian iron ore deposits have an average cut-off grade of 59.6% Fe content. These are used as direct feed to smelters, both as a raw lump or fines and in processed forms as sinter or pellets.
Hematite ore, also known as direct shipping ore, has Fe content in the range of 56-62%, and processing of this type of ore is relatively simple. Australia has a large, high quality hematite resource capable of producing low cost, direct shipping ore.
The future outlook for iron ore mining in Australia is bright, thanks to the country’s strong resource base and competitive advantage in transportation costs."
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From the annual Report Page 38 onward:
So at WAIO they are planning to increase iron ore production. A study of feasibility to complete in CY2025
At Copper South Australia:
The regional operation is expected to double output.
"BHP is eyeing to lift its annual output from the region to 500,000 metric tons of cathode by early 2030s, from 322,000 tons produced last financial year. It expects to raise the output to up to 650,000 by the mid-2030s.BHP will make a final investment decision on the expansion in 2027, it added."
They are still exploring Oak Dam which will be developed.
Carrapateena, I knew nothing about, but it's big. They are moving into sub-level block caving that and think it will be a multi-generational low cost operation.
Prominent Hill: they only acquired it from Oz Minerals in 2023, so to have bothered with that it must be a long lived operation.
Olympic Dam: Somewhere I read that it has a 100 years of mine life. An interesting snippet, Olympic has 96m ozs of gold in its resource.
Jansen Potash in Canada. Another giant project that they've spent many billions on and are only halfway through development of a first stage. First production 2026.
So at WAIO they are planning to increase iron ore production. A study of feasibility to complete in CY2025
At Copper South Australia:
The regional operation is expected to double output.
"BHP is eyeing to lift its annual output from the region to 500,000 metric tons of cathode by early 2030s, from 322,000 tons produced last financial year. It expects to raise the output to up to 650,000 by the mid-2030s.BHP will make a final investment decision on the expansion in 2027, it added."
They are still exploring Oak Dam which will be developed.
Carrapateena, I knew nothing about, but it's big. They are moving into sub-level block caving that and think it will be a multi-generational low cost operation.
Prominent Hill: they only acquired it from Oz Minerals in 2023, so to have bothered with that it must be a long lived operation.
Olympic Dam: Somewhere I read that it has a 100 years of mine life. An interesting snippet, Olympic has 96m ozs of gold in its resource.
Jansen Potash in Canada. Another giant project that they've spent many billions on and are only halfway through development of a first stage. First production 2026.
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well OZ minerals had been making a profit recently ( without the help of BHP ) so am not sure what synergies they are expecting
given the minerals extracted at Olympic Dam and Oak Dam , i doubt the old OZ mineral plants will be efficient processing BHP ore , maybe shifting workers between projects might save some $$$ ( heavy machinery as well )
given BHP was fairly generous in the OZL take-over it is going to be interesting to see how BHP wins overall , apart from grabbing more global resources
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With such glowing figures, bet it all...
To each, his her own.i know intimately how bhp works and i have not a cent there.
I am not going to play a reverse VC and stops here
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Have a look at the map. Oz Mineral's properties and BHP's Olympic and Oak Dams are a localised regional operation. Conceivably one operation can have a shutdown with others taking up the slack? OZL I believe produced a concentrate wheras O.D has the full kit, right through to refining copper - could be advantages there. Olympic Dam smelting and refining is on an expansion path (1) Presumably personnel efficiencies from the amalgamation. Trucks, mining fleet, workshops - might be efficiencies there.
(1) "BHP Group is continuing to push ahead with the expansion of its copper smelter and refinery at Olympic Dam in South Australia"
They won't be processing BHP ore. They'll be doing what they were doing pre takeover.