BHP lifts iron ore spot market target

BHP BILLITON has revealed plans to sell about 19 million tonnes of iron ore on the spot market this year as it capitalises on strong demand from China.

BHP's chief financial officer, Alex Vanselow, said yesterday the company hoped to sell 15 per cent of its production on the spot market, up from less than 10 per cent (or 11 million tonnes) last year.

BHP's equity share of production from its iron ore mines in the Pilbara and Brazil was 111 million tonnes last year.

BHP's takeover target, Rio Tinto, has also been increasing its spot market sales. It plans to sell 15 million tonnes this calendar year.

BHP's full-year earnings of $US15.4 billion ($17.7 billion) fell within the expectations of Australian analysts but below British forecasts of $US15.7 billion.

Mr Vanselow - the former head of BHP's aluminium division - said the short-term outlook for aluminium and nickel was worse than for steel-making materials because aluminium and nickel tended to be used for finished products in developed economies.

But he said the long-term outlook for aluminium was strong and Rio's Canadian aluminium smelters were "extremely attractive", as were its Gove and Yarwun refineries.

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