Bhp Share Discussion Threads

[waldron] 14/12/2022 16:10

Ian Lyall

15:00 Wed 14 Dec 2022





US bank Jefferies has released a research note stating that its analysts have been positive on iron ore for the past six weeks, due to the potential for a China reopening and seasonal supply issues.

The rally in iron ore prices has occurred, up from $76 per tonne on October 31 to $112/t last week. However, the outperformance of iron ore relative to copper has likely played out, the bank's analysts think

Despite this, the Jefferies' analysts still see good value in shares of Rio Tinto PLC (LSE:RIO), BHP Group Ltd (LSE:BHP, ASX:BHP) and Vale SA.


Policies 'more accommodative'

They attribute the rally in iron ore prices to an improving outlook for the Chinese economy and believe that more accommodative policies with respect to Covid and the property market will lead to stability in demand for iron ore.

However, the Jefferies analysts do not expect a strong recovery in demand as Chinese property, which accounts for around 35% of iron ore demand in the seaborne market, is likely in structural decline.

Overall, Chinese steel production should track demand, and they expect only a small increase, if any, in China's steel production over the next year.

Iron ore supply is also expected to be roughly flat year-on-year, as the major miners are not increasing production significantly, investors were told.

The Jefferies' analysts expect a balanced market with prices in the $90-110 per tonne range for 2023. The consensus view is that iron ore prices will normalize to the $70-80 per tonne range, and this will happen soon.

However, the analysts expect periods when the price will be in this range, but it believes that a value-over-volumes approach for the major miners and a steepening cost curve will lead to a long-term average price of at least $90 per tonne.

In contrast, they believe that the period of relative outperformance of iron ore in mining is over and that copper is a better commodity to invest in for a ‘12+ month horizon’.

Proactive

[montyhedge] 14/12/2022 15:27

Glencore top pick for 2023 by JP Morgan and the shares still down.https://www.proactiveinvestors.co.uk/companies/news/1001179/glencore-named-top-pick-for-2023-in-jpmorgan-cazenove-european-metals-mining-review-rio-tinto-downgraded-1001179.html

[anhar] 12/12/2022 10:36

The acquisition trend at the top of the market is not just a mining industry thing. It occurs across the market and some see widespread bid activity as one indication that the market is near a top.

[eggbaconandbubble] 10/12/2022 18:25

Should I put off buying Bacofoil for the Christmas turkey?

[podgyted] 10/12/2022 15:19

It was this I was thinking of:-



Soon after BHP tried to buy Rio going from memory - heady days.

I think they've all learnt their lesson, this time it may well be different.

[cheshire pete] 06/12/2022 13:06

That was my recollection too Ted. From memory and correct me if wrong, deals were at high MCaps and loaded balance sheet with high levels of debt leaving some high and dry as commodities and sps fell subsequently.
Big miners' policy currently to pay out a large proportion of cash to shareholders as dividends. Long may it continue as hopefully the global recession passes. I'm inclined to hold but remain watchful.

[nimbo1] 05/12/2022 09:23

Was thinking about the same thing. I guess we have the green transition rhetoric and the high dividend yield and Russia situation... which should all be supportive but thinking this time is different normally doesn't work. Im holding on anyway at the moment.

[podgyted] 04/12/2022 17:21

Just a thought.

The last time major miners started buying one another was the harbinger of a crash in mining stock.

But ........... there's always ......... This time it's different.

Who knows.

[1hughb] 28/11/2022 19:25

BHP is mentioned here: Https://youtu.be/LMv0ZJ07oow

[spawny100] 25/11/2022 15:23

Rio down BHP up. Weird.

[la forge] 19/11/2022 09:18

OZ Minerals close to accepting BHP’s revised takeover offer of $6.4bn


By NS Energy Staff Writer  18 Nov 2022

According to BHP, the proposed transaction will enable the creation of a copper basin in South Australia which could tap potential operational synergies driven by the proximity that OZ Minerals’ Carrapateena and Prominent Hill operations have with its own existing Olympic Dam asset and Oak Dam development resource


OZ Minerals (OZL) said that its board intends to recommend a revised takeover proposal of A$28.25 ($18.95) per share in cash from BHP, which translates to an enterprise value of A$9.6bn ($6.44bn).

The Australian mining company said that the proposed consideration is the best and final that BHP is willing to offer.

OZ Minerals’ board has confirmed to BHP that it plans to recommend the revised proposal unanimously to the company’s shareholders as being in their best interests, in the absence of a superior proposal.

The recommendation is also subject to the two mining firms executing a binding scheme implementation agreement (SIA) after BHP completes a confirmatory due diligence and an independent expert finds the revised proposal to be in the best interests of OZ Minerals’ shareholders.

In August 2022, OZ Minerals rejected BHP’s takeover bid of A$25 ($16.8) per share in cash or A$8.34bn ($5.6bn) from BHP Group, citing that the proposed deal considerably undervalues its business.

OZ Minerals managing director and CEO Andrew Cole said: “BHP’s Revised Proposal is a clear reflection of OZ Minerals’ unique set of highly strategic, quality assets in quality jurisdictions and an enviable multigenerational growth pipeline of copper and nickel assets in strong demand due to global electrification.

“We look forward to working with BHP in a collaborative way to progress the Revised Proposal in the best interests of OZ Minerals’ and its stakeholders.”

OZ Minerals is engaged in developing a portfolio of long life, low-cost copper-focused assets. It has two operating assets, which are the Prominent Hill copper mine and the Carrapateena copper mine, both located in Australia.

The company and BHP have entered into a confidentiality and exclusivity deed with respect to the latter’s revised proposal.

According to BHP, the proposed deal will enable the creation of a copper basin in South Australia which could tap potential operational synergies driven by the proximity of the Carrapateena and Prominent Hill operations with its own existing Olympic Dam asset and Oak Dam development resource.

BHP CEO Mike Henry said: “BHP’s proposal represents a highly compelling offer for OZL shareholders, providing certainty at a time of macroeconomic uncertainty and market volatility, and increasing risks for the industry.

“The combination of BHP and OZL’s assets, skills and technical expertise provides a unique opportunity not available under separate ownership, with complementary resources including the Oak Dam exploration prospect and existing facilities within close proximity, backed by BHP’s strong balance sheet, capital discipline and commitment to sustainable development.”

[grupo guitarlumber] 18/11/2022 09:00

18 November 2022 - 09:30AM
Dow Jones News


BHP, World's Top Miner, Nears Biggest Acquisition in a Decade


Australia's OZ Minerals says it intends to recommend BHP's revised offer valuing its equity at $6.34 billion.

[waldron] 18/11/2022 08:13

TOP NEWS: BHP says Oz board backs raised offer of AUD28.25 per share

Fri, 18th Nov 2022 07:32
Alliance News

(Alliance News) - BHP Group Ltd said on Friday the board of Oz Minerals Ltd intends to recommend an improved takeover offer that values Oz at AUD9.6 billion.

Oz is a gold, copper and nickel miner. It owns and operates the Prominent Hill and Carrapateena mines in South Australia. It also has an interest in the Pedra Branca copper-gold mine in Brazil.

BHP, a Melbourne-based diversified miner, said it increased its non-binding indicative offer to AUD28.25 per Oz share in cash, representing a premium of 49% to Oz's closing price of AUD18.92 per share on August 5, when BHP tabled it initial offer.

Back in August, BHP offered AUD25.00 per share in cash for Sydney-listed Oz, but the Oz board rejected it at the time.

On Friday, Oz confirmed that its board intends to unanimously recommend BHP's revised offer to its shareholders. It said the takeover approach was in the best interest of its shareholders in the absence of a superior proposal.

The two companies said on Friday they had entered into a confidentiality and exclusivity deed in relation to the revised proposal. Under this accord, Oz has granted BHP four weeks to undertake exclusive confirmatory due diligence and negotiate a binding agreement.

The four-week period is expected to commence on or around Monday next week.

BHP said its latest Oz offer represented its the "best and final" price it is willing to pay.

Shares

in BHP closed up 0.3% at AUD43.94 in Sydney on Friday, giving it a market capitalisation of AUD222.59 billion, about USD149.21 billion.

Oz was up 4.0% to AUD27.34 in Australia, giving it a market capitalisation of AUD9.15 billion.

BHP said Oz might pay a franked dividend to Oz shareholders before the deal is implemented.

The revised proposal is subject to conditions including completion of due diligence, and shareholder and regulatory approvals.

"The cash consideration price under the revised proposal will be reduced by the cash component of any dividends or return of capital paid by OZL before the date of the implementation of the revised proposal," BHP said.

BHP Chair Ken MacKenzie said: "BHP's proposal would provide value to BHP shareholders by increasing exposure to future facing commodities, attractive synergies and adding to our pipeline of growth options."

Added BHP Chief Executive Mike Henry: "BHP's proposal represents a highly compelling offer for OZL shareholders, providing certainty at a time of macroeconomic uncertainty and market volatility, and increasing risks for the industry."

By Artwell Dlamini; [e-mail]

[gibbs1] 10/11/2022 07:48

TOP NEWS: BHP warns of economic uncertainty, "repositioned" for future

Thu, 10th Nov 2022 06:52


(Alliance News) - BHP Group Ltd warned on Thursday that the geopolitical landscape continued to change and economic conditions remained uncertain in the short term.

Speaking ahead of the annual general meeting to be held in person on Thursday, BHP Chair Ken MacKenzie said the mining firm was "fundamentally repositioned" for the future, highlighting its foray into potash.

The Australian miner recognises that demand for potash will increase because the world will need more food. Potash is potassium-containing salts used as fertiliser.

BHP has said it was working to bring forward first production at its Jansen potash project in Canada to 2026. In 2021, it approved capital expenditure of USD5.7 billion for its Jansen stage 1 potash project.

"Potash is a new commodity for BHP which has the potential to deliver value for a century or more," MacKenzie will tell shareholders.

MacKenzie also noted the group has recently merged its petroleum business with Woodside Energy Group Ltd; simplified its coal portfolio to focus on higher-quality metallurgical coal used for steelmaking; and unified its corporate structure.

The chair will also tell shareholders that the short-term outlook was complex, with the geopolitical landscape continuing to change and economic conditions remaining uncertain.

There are ongoing labour and skills shortages, while countries are emerging from the impact of the global Covid-19 pandemic at different paces, he said.

Despite the challenging environment, the company delivered strong operational and financial results for the financial year to June 30.

Over this period, BHP posted record earnings before interest, taxes, depreciation and amortisation of USD40.6 billion, up 16%.

Revenue for the financial year ended June 30 rose 14% to USD65.10 billion from USD56.92 billion. Pretax profit was 36% higher at USD33.14 billion from USD24.29 billion.

BHP's full-year payout totalled 325.0 cents, up 8.0% from 301.0 cents the previous year. It also paid a special dividend

of 386.4 cents as a result of its merger with Woodside.

MacKenzie said the repositioning of the company will align it with the "megatrends" of decarbonisation, population growth and demand for higher standards of living.

The demand for copper, nickel and steel will grow to enable the infrastructure and products required for the energy transition, he said.

Chief Executive Mike Henry, addressing the AGM, will tell shareholders that the company continued its track record of transforming itself to meet the needs of the world.

By Artwell Dlamini; [e-mail]

[action] 29/10/2022 08:22

Ps China restrictions may be lifted in February ie Chinese New year

[action] 29/10/2022 08:21

Traditionally weak months b4 January reporting. Goes up near exd time in February. I hope history repeat itself this time as well.

[loganair] 28/10/2022 15:51

ACTION - 50% of BHP revenues comes from Iron Ore.

The price of Iron Ore which is down some 47% since its peak this year and down 62% since its May 2021 peak.

As with my previous post to Monty, therefore less need for Iron Ore and with the continuing C restrictions in China there is no foreseeable uptick in the price of Iron Ore.

[loganair] 28/10/2022 15:46

monty - Steel production is down - circa 200mln Chinese are still under some form of C restriction of which 20mln are under full lock down.

[action] 28/10/2022 15:23

Down 5% plus

[montyhedge] 19/10/2022 18:23

Thermal coal production down 38% I suppose might be the same for Glencore, surely that would push up Newcastle thermal coal price.

[waldron] 19/10/2022 06:11

News Highlights: Top Company News of the Day
19 October 2022 - 05:30AM
Dow Jones News


BHP Iron-Ore, Copper Output Up, Coal Production Down


BHP Group reported higher iron ore, copper and nickel production in the first three months of its fiscal year, but said output of energy and steelmaking coal was weaker.

[waldron] 19/10/2022 06:09

BHP Group Ltd. on Wednesday reported higher iron ore, copper and nickel production in the first three months of its fiscal year, but said output of energy and steelmaking coal was weaker.

The world's largest miner by market value said it produced 65.1 million metric tons of iron ore, the key ingredient in steel, in the three months through September, up 3% on the year-earlier period. It cited a strong operational performance at its Western Australian mining operations, and reduced pandemic-related disruptions.

BHP said its output of copper was up by 9% over the same period to 410,100 tons, in big part because of a rebound in Olympic Dam production following significant smelter maintenance work a year ago. Its output of nickel was 16% higher at 20,700 tons, which was also a rebound from maintenance work in the year-earlier period.

The company produced 1% less metallurgical coal, used in steelmaking. Quarterly production of that commodity totaled 6.7 million tons, as BHP grappled with significant disruptions from wet weather.

Its thermal-coal production was down 38%, at 2.6 million tons, which the company also attributed to wet weather as well as labor shortages.



Write to Rhiannon Hoyle at [e-mail]



(END) Dow Jones Newswires

October 18, 2022 18:05 ET (22:05 GMT)

[cerrito] 15/10/2022 21:30

Yesterday Friday went on an UKSA/sharesoc meeting with the Chairman of BHP and the general consensus wD that he gave a first class presentation.
I am happy with the small amount I have but given the situation in China will not be adding more at these prices.

[ariane] 15/10/2022 13:41

19 October 2022, 8:30 AM Melbourne time (approximate)

BHP Operational Review
For the quarter ended 30 September 2022