The company logo adorns the side of BHP’s global headquarters in Melbourne on February 21, 2023. – The Australian multinational, a number one producer of metallurgical coal, iron ore, nickel, copper and potash, said net profit fell 32 percent year-on-year to $6.46 billion within the six months to December 31. (Photo by William WEST / AFP) (Photo by WILLIAM WEST/AFP via Getty Images)
William West | Afp |
BHP CEO Mike Henry said he expects China’s real estate sector to get better next yr attributable to favorable government policies.
While Henry acknowledges that the country’s real estate sector is a “weak spot” for steel demand, he’s optimistic in regards to the measures recently announced by the Chinese government.
“The government recently introduced measures to support the real estate sector. … We expect that there could be a turnaround in the real estate sector in the coming year,” Henry said.
In recent months, China has taken a series of measures to stabilize the country’s real estate sector. which once reportedly accounted for about 25 to 30 percent of the country’s GDPFor example, Beijing abolished the nationwide minimum rate of interest for mortgages and reduced the minimum down payment rate for first-time buyers from 20% to fifteen%.
In May The central bank also announced that it would supply 300 billion yuan (US$42.25 billion) to financial institutions to lend to local state-owned enterprises for the acquisition of unsold and already accomplished housing.
On Saturday, China’s Housing Minister Ni Hong said: There remains to be “great potential and space” for China’s real estate sector will expand because the country’s urbanization progresses and the demand for good housing continues to rise.
BHP reported a 2% increase in annual profit on Tuesdayand attributed the expansion to “solid operating performance and higher commodity prices for key raw materials.”
Henry noted, nonetheless, that there remains to be “some volatility” in China’s steel demand, which is under pressure from the true estate sector.
However, the CEO stressed that there are other sectors in China that contribute to steel demand and are showing quite healthy growth, corresponding to infrastructure, shipping and the automotive industry.
Australian shares of BHP were up 1.97% in trading on Tuesday.
