Mining giant BHP has said it expects market volatility caused by inflationary pressures, labour shortages, and supply chain disruption to continue into 2023.
In a trading update, the Australian firm said the war in Ukraine and the energy crisis in Europe will offset any positive economic impacts of China’s stimulus policies on global growth, as the miner said it expects to see an “overall slowing of global growth” in the coming year.
In a statement, BHP chief executive Mike Henry said: “Broader market volatility continues and we expect the lag effect of inflationary pressures to continue through the 2023 financial year, along with labour market tightness and supply chain constraints.”
“Over the year ahead, China is expected to contribute positively to growth as stimulus policies take effect, however, the continuing conflict in the Ukraine, the unfolding energy crisis in Europe and policy tightening globally is expected to result in an overall slowing of global growth,” Henry added.
The comments come after Anglo-Australian mining firm Rio Tinto last week raised similar concerns in warning of “considerable” headwinds in the coming year, due to labour shortages, lockdowns in China, and economic downturns across the globe.
In its trading update, BHP posted a muted performance for the financial year 2022, which saw the firm produce less copper, coal, and nickel than the year before.
Nonetheless, the Melbourne headquartered firm said it had been able to “fully capitalise” on high iron ore prices in the previous quarter, after robust demand for the ore in China saw iron ore prices surge.