BHP Billiton releasing their chairman's letter to shareholders yesterday

BHP Billiton releasing their chairman's letter to shareholders yesterday outlining the tax issues that all the mining companies face in Australia. As the letter points out however, "there is still a great deal of detailed work to be done before this tax is enacted and its impact is certain. We will work with the Government to ensure that the final outcome of the minerals taxation proposal maintains the international competitiveness of the Australian resources industry and is in the long term interests of all Australians." And not just Australians is where our interests lie, but rather the shareholders of BHP Billiton, who are spread across the globe. I think what I read into it is that whilst all parties feel a little more comfortable, the fact remains that Australia still has a high tax rate. Check out the whole letter.



This is a great snapshot of the copper majors and what their output was last year. And this again underscores why we like BHP Billiton, because of their diversity in the mining space. Not only are they a iron ore major, but here you can see that they are a copper major:




A table from Bloomberg, with production figures in thousands of metric tons, I have left the bottom three off the list. Remember that Codelco is the Chilean copper company that has really been able to compete with the global majors as a government entity. It does help when the skills WANT to work for you. Check it out.




Company Production


1. Codelco 1,781


2. Freeport-McMoRan 1,611


3. BHP Billiton Ltd. 1,168


4. Xstrata Plc 837


5. Rio Tinto Group 822


6. Anglo American Plc 686


7. Glencore International AG 671




I guess the comment that I made about BHP Billiton holds true for Rio Tinto here too, and Glencore remember have more than a third stake in Xstrata, so their copper production is actually higher than that, I guess. They would sit in placing 4 on the scoreboard. Dr. Copper perhaps used to hold true to this definition: "Many traders have affectionately referred to copper as "Dr. Copper," because it is considered to be "the only metal with a Ph.D. in economics." That is, copper historically has been considered to be an excellent barometer of the overall state of global economic activity because of its widespread use in industrial applications" I suspect that this holds true in a world 7 to 8 years ago. Dr. Copper is perhaps not the predictor that he or she once was, simply because the demand is from different quarters of the globe now.