BHP Billiton bucks trend with optimistic outlook for coal

 
Jessica Morris
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China's Consumption Of Coal Steadily On The Rise
An economic slowdown in China has led to low prices, decimating the coal sector. (Source: Getty)

BHP Billiton, the world's biggest mining company, delivered an upbeat outlook for coal to an investor briefing today.

The FTSE 100 listed firm is swimming against a tide of pessimism which surrounds the fossil fuel. An economic slowdown in China has led to low coal prices, consequently decimating the sector.

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"The developing world needs steel, steel needs coking coal, and we have the strongest resource position in the seaborne market," Mike Henry, president of operations for minerals for Australia at BHP, said.

"Against the backdrop of greater uncertainty in the outlook for thermal coal, we are confident that base demand in emerging economies will remain resilient for decades to come and our higher quality coals position us well in an increasingly carbon constrained world."

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It came as BHP announced plans to boost the competitiveness of its coal operations — in terms of costs and volumes.

This is a stark contrast to other miners such as Glencore who have reduced coal output or shuttered unprofitable mines. And US coal producers like Peabody, Arch Coal, Patriot and Alpha Natural Resources have all for bankruptcy in the last year.

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