BHP Billiton Ltd., the world’s largest mining company, has been surprised by the rapid recovery in China’s economy after the global financial crisis curbed prices and cut demand.

“Over the past six months, we have seen quite a rebound in commodity
prices and in particular, the velocity of the recovery in China has
indeed been surprising,” Marius Kloppers, 47, chief executive officer
of the Melbourne-based company, said today at the company’s annual
meeting in Brisbane, Australia. “One element that continues to surprise
us, however, is the resilience of the Chinese steel sector.

Commodities, as measured by the Reuters/ Jefferies CRB Index of 19 raw
materials, have gained 21 percent this year, reversing a 36 percent
decline last year. Steel demand in China may rise 12 percent next year
on booming property and auto demand, China International Capital Corp.
said this month.

“We have no reason to change our long-held view that Chinese growth
will continue and will continue to be resources- intensive,” Kloppers
said.

BHP gained 0.8 percent to A$41.50 at 11:53 a.m. Sydney time on the
Australian stock exchange. The stock, which has ten ‘buy’ ratings, four
‘hold’ ratings and two ‘sell’ ratings, has gained 36 percent compared
with a 27 percent gain on the benchmark index.

China’s economy expanded 8.9 percent in the third quarter, the fastest
pace in a year. Demand for minerals is on the verge of “unprecedented
growth” as China and India drive consumption, BHP Chairman Don Argus
said Oct. 22.

BHP last month reported record first-quarter production of iron ore as
steel companies resume output at mills in China, Europe and the U.S. on
signs of recovery in the global economy. China accounted for $9.9
billion, or 20 percent, of BHP’s sales in the year ended June 30,
according to the company.

Source: Bloomberg

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