BHP Billiton plans to increase mining efficiency through job cuts and other costs

BHP Billiton, the largest miner in the world, employs approximately 16,000 people in its iron ore division. BHP sees job cuts at its flagship Australian Iron Ore division as a way to keep costs down as ore prices have fallen and costs need to be curbed. This was reported in www.provod-cabel.com .

In Australia, a once thriving mining sector, thousands of jobs are likely to disappear in response to cooling demand, mainly in China, for imports of iron ore, coal and copper. A BHP spokesman said they would have to give up 3,000 jobs.

Iron ore prices have dropped more than 30 percent this year due to slowing demand growth in China, the main market for Australian ore. BHP hired consultants to help find ways to reduce overhead costs and increase productivity. And just last month, the company's total capital expenditure fell 25 percent and will continue to decline in fiscal 2015.

BHP continues to expand its iron ore mining operations. A sharp drop in iron ore prices could force China to close some of its mines, which could ultimately benefit BHP and other large Australian miners who can send more ore to Chinese steel mills.

Despite this, profits from iron ore mining, BHP's largest business, rose 60 percent in the first half of fiscal 2014, while oil revenues fell 16 percent and copper revenues rose just 0.4 percent.

In the meantime, more than 12,000 jobs have been lost in Australia's mining sector since 2012, including in BHP mines, as the industry grapples with falling prices and fierce competition from countries like Indonesia.