BHP looks to India for coal growth as China demand declines

Image from BHP

The world's biggest miner, BHP (LON: BHP) is looking to India's fast- growing economy and its accelerating steelmaking output as a way to help offset the declining Chinese coal demand in the new decade, the Syndey Morning Herald reported.

China's consumption of iron ore and coal - key steelmaking ingredients and Australia's two top exports - led to a windfall in 2019 for the world's top miners, and added a boost to the Australian government's federal budget.

But Chinese demand is projected to ease in the face of lower margins, weakening global growth and the ongoing US-China trade war.

Meanwhile, BHP projects Indian steelmaking is on course to grow by 7% per year over the next decade. India's yearly output of over 100 million tonnes of steel has now surpassed Japan to become the world's second-largest steelmaking country.

A lot of other markets are big but mature," BHP vice-president of market analysis Huw McKay told the Sydney Morning Herald.

"India is big but it's barely got started."