BHP Billiton: Iron ore inquiry would send wrong signal on free trade

In response to Australian independent senator Nick Xenophon's request for an inquiry into the impact of declining iron ore prices on the nation's revenue and budget deficit, Australian iron ore miner BHP Billiton said on Tuesday, May 19 that an inquiry into Australia's iron ore industry was unnecessary. Speaking on ABC radio in Australia, BHP Billiton CEO Andrew Mackenzie said an inquiry would send the wrong signal to international customers about the country's commitment to free trade.
 
The BHP Billiton CEO said that the company supported Australia's focus on trade and competition as drivers of growth and was committed to playing a role in improving the nation's competitiveness. He said an inquiry would be an "amazing gift" for Australia's competitors, given iron ore is a globally-traded commodity with other major sources of supply around the world in countries such as Brazil, South Africa, India and China.
 
Mr. Mackenzie indicated that BHP Billiton was anticipating, and had stated on many occasions, that supply growth would exceed demand growth. Therefore, the company acted early and deferred around 180 million mt per year of growth opportunities in 2012, including 110 million mt per year from the Outer Harbor Development and 70 million mt per year from two additional berths not taken up in the Port Hedland inner harbor.