I think Iron Ore will likely average around $75 USD per ton and Oil will average around $75 per barrel WTI in 2015. If AUD averages 0.75 USD then that equates to $100 AUD per ton/barrel of oil. Very healthy 400% margin on iron ore at that stage.
BHP will be better placed than almost anybody to make good profits at such price levels. Then think into the future to the next mining boom and the profit possibilities.
Their key assets are tier one quality and in some cases with a life of hundreds of years at planned production rates.
If you wish to take a very short term view it is your right but longer term it is hard to compete with BHP given the quality of their assets resources and their scale of operations they are always at the low end of the cost curve and high end of the grade curve. They always seem to be in profit just the level varies with market ebb and flow. In the next boom cycle BHP will be well placed to capitalise with super profits. Now is the time to buy IMO when fear is rife in the market. This week it looks like the best opportunity might be behind us?
AGO Price at posting:
14.5¢ Sentiment: None Disclosure: Not Held
BCI Price at posting:
52.5¢ Sentiment: None Disclosure: Not Held
FMG Price at posting:
$2.69 Sentiment: None Disclosure: Not Held
GRR Price at posting:
11.5¢ Sentiment: None Disclosure: Not Held
MGX Price at posting:
24.5¢ Sentiment: None Disclosure: Not Held
RIO Price at posting:
$57.73 Sentiment: None Disclosure: Not Held
AJM Price at posting:
5.1¢ Sentiment: None Disclosure: Not Held
BHP Price at posting:
$29.84 Sentiment: Buy Disclosure: Held
