BHP Billiton pins hope on booming demand from Chin
MELBOURNE BHP Billiton, the world's largest diversified mining group, said yesterday that booming demand from China would help offset challenging conditions elsewhere.
The Anglo-Australian mining giant was also forced to defend its industrial relations record after unions claimed it was violating a United Nations (UN) agreement it had signed guaranteeing workers' rights.
Chairman Don Argus told the BHP Billiton annual general meeting that the company expected strong demand from China to continue and to broaden beyond iron ore and alumina.
"In fact, it would not be surprising if the Chinese demand for nickel and other stainless steel components increases beyond general expectation," he said.
Argus said BHP Billiton was in "good financial shape", but refused to give specific performance forecasts.
The company recently posted a 9,4% fall in attributable net profit of $518m, blaming adverse currency movements that cost it $215m.
CE Chip Goodyear said the strengthening Australian dollar and South African rand, and the weakness of the US dollar would continue to challenge business in the year to June next year.
He said the company was concentrating on its operational performance.
Argus said the European economy remained flat, but he expected the US market to gain strength and for there to be a modest recovery in Japan.
"The Japanese economy has expanded for six consecutive quarters," he said.
"Strengthening domestic demand combined with strong growth in the Asian region, including China, should support a continuation of a modest recovery'" he said.
Argus denied union claims it had broken the UN Global Compact by forcing new workers at its Pilbara iron ore operations in west Australian to sign individual contracts, rather than bargain collectively through a union.
"It's important to note that the UN does not suggest that employers change their industrial relations framework," Argus told shareholders.
The president of the CFEMU union's mining division, said BHP Billiton had only paid lip service to UN principles to try to win favour as a socially responsible company. Sapa-AFP
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