CORRECTED-UPDATE 1-BHP Billiton sees no lift in medium term for iron ore, coal prices

miércoles 20 de enero de 2016 00:06 GYT
 

(Corrects paragraph 8 to show company reaffirmed guidance for declines, not increases, in copper, coal, petroleum output)

By Sonali Paul

MELBOURNE Jan 20 (Reuters) - BHP Billiton flagged on Wednesday that it sees no recovery in iron ore or coal prices in the next few years while holding out hope for a rebound in copper and oil as the company fights a slump in earnings set to hit its long-protected dividend.

The top global miner reinforced bearish views on the sector which has been slammed by oversupply at a time when growth in China, the biggest metals consumer, has slowed down.

In a sign BHP may cut its dividend, ending a long held policy to maintain or increase its payout every year, BHP Chief Executive Andrew Mackenzie said in the company's quarterly production report that it was focused on defending its investment grade credit rating.

"In this environment, we are also committed to protecting our strong balance sheet so we have the financial flexibility to manage further volatility and take advantage of the expected recovery in copper and oil over the medium term," Mackenzie said.

He made no mention of any recovery in iron ore or coal prices.

BHP is reeling as oil prices have slumped further than expected at the same time as its other products have plunged to multi-year lows. Average prices for its commodities slumped between 20 and 51 percent in the first half of its financial year compared to a year earlier, with crude oil the worst hit.

Like its peers, BHP has been ramping up production as it looks to cut costs per unit amid the price slump, which has only exacerbated the global oversupply.   Continuación...