BHP Billiton and Mitsubishi to cut 700 jobs
BHP Billiton and Mitsubishi will cut 700 jobs at a joint coal mining
venture in Australia because of tough market conditions. Both companies
said they found the business was overstaffed following an operational
The job cuts account for about 7% of the joint venture's total
workforce. The joint venture, which includes seven coal mines and a coal
terminal in Queensland, is the world's biggest exporter of coal used in
"The coal industry continues to face challenging market conditions
and had to act to ensure the long-term viability of the business," the
BHP Billiton-Mitsubishi Alliance (BMA) said in a statement.
Coking coal mines have been closed or seen production plummet after
prices hit a six-year low because of global oversupply. Coal prices
trade at about $110 (£67) a tonne at present, but some analysts believe
that may fall further as a result of weak demand from top buyer China.
"A slowdown in China's manufacturing marks low demand from an economy
which Australia relies on heavily for commodity exports," Desmond Chua
from CMC Markets said.
BHP has called its coal unit one of its "four pillars of growth"
along with iron ore, copper and petroleum products.
However, the firm has been under pressure to lower operating costs
because of a slump in iron ore and coal prices. Both raw materials are
used in the production of steel.
Last week, it also announced plans to cut jobs at its Port Hedland
iron ore mines in Australia.