BHP Group

Analyst thesis

Our recommendation is based on: 

• BHP reported record consolidated copper production of 2.02 million tonnes in FY25, which exceeds Freeport-McMoRan’s consolidated copper production for 2024.
• Copper demand is poised to expand in the coming years amid the global shift towards electrification, renewables, and digital infrastructure. Meanwhile, the IEA flagged a potential copper supply shortfall by 2035, suggesting that prices are likely to remain well supported in such an environment.
• BHP’s Vicuña joint venture is anticipated to start copper production around 2030, increasing overall production in a demand-rich environment, while benefitting from synergies that will lower costs.
• BHP’s low-cost operations and disciplined capital management position it to sustain a prolonged cyclical recovery in bulk commodity demand, like iron ore, which is very sensitive to the Chinese economy and construction industry.