BHP鋼鐵與鐵礦石市場展望

Steelandironoremarketoutlook

DrHuwMcKay

VicePresident,MarketAnalysisandEconomics

DrRodDukino

VicePresident,SalesandMarketingSustainability

3October2022

Disclaimer

Forward-lookingstatements

Thispresentationcontainsforward-lookingstatements,including:statementsregardingourstrategy,ourvaluesandhowwedefinesuccess;ourexpectationsofacompetitiveadvantageforourbusinessorcertainproducts;ourcommitmenttogeneratingsocialvalue;ourcommitmentsundersustainabilityframeworks,standardsandinitiatives;ourintentiontoachievecertainsustainability-relatedtargets,goals,milestonesandmetrics;statementsregardingtrendsineconomicoutlook;commoditypricesandcurrencyexchangerates;demandforcommodities;medium-termguidance;productionforecasts;operationalperformance;expectations,plans,strategiesandobjectivesofmanagement;climatescenarios;assumedlong-termscenarios;potentialglobalresponsestoclimatechange;thepotentialeffectofpossiblefutureeventsonthevalueoftheBHPportfolio;closureordivestmentofcertainassets,operationsorfacilities(includingassociatedcosts);anticipatedproductionorconstructioncommencementdates;capitalexpenditureorcostsandscheduling;operatingcosts,includingunitcostguidance,andshortagesofmaterials

andskilledemployees;anticipatedproductivelivesofprojects,minesandfacilities;provisionsandcontingentliabilities;andtaxandregulatorydevelopments.

Forward-lookingstatementsmaybeidentifiedbytheuseofterminology,including,butnotlimitedto,‘guidance’,‘outlook’,‘prospect’,‘target’,‘intend’,‘a(chǎn)im’,‘a(chǎn)mbition’,‘a(chǎn)spiration’,‘goal’,‘project’,‘a(chǎn)nticipate’,‘estimate’,‘plan’,‘believe’,‘expect’,‘commit’,‘may’,‘should’,‘must’,‘will’,‘would’,‘continue’,‘forecast’,‘trend’,‘a(chǎn)nnualised’orsimilarwords.Thesestatementsdiscussfutureexpectationsconcerningtheresultsofassetsorfinancialconditions,orprovideotherforward-lookinginformation.

Theforward-lookingstatementsarebasedontheinformationavailableasatthedateofthispresentationand/orthedateoftheGroup’splanningprocessesorscenarioanalysisprocesses.Thereareinherentlimitationswithscenarioanalysisanditisdifficulttopredictwhich,ifany,ofthescenariosmighteventuate.Scenariosdonotconstitutedefinitiveoutcomesforus.Scenarioanalysisreliesonassumptionsthatmayormaynotbe,orprovetobe,correctandmayormaynoteventuate,andscenariosmaybeimpactedbyadditionalfactorstotheassumptionsdisclosed.

Additionally,forward-lookingstatementsinthispresentationarenotguaranteesorpredictionsoffutureperformance,andinvolveknownandunknownrisks,uncertaintiesandotherfactors,manyofwhicharebeyondourcontrol,andwhichmaycauseactualresultstodiffermateriallyfromthoseexpressedinthestatementscontainedinthisrelease.BHPcautionsagainstrelianceonanyforward-lookingstatementsorguidance,particularlyinlightofthecurrenteconomicclimateandthesignificantvolatility,uncertaintyanddisruptionarisinginconnectionwiththeUkraineconflictandCOVID-19.

Forexample,ourfuturerevenuesfromourassets,projectsorminesdescribedinthisreleasewillbebased,inpart,uponthemarketpriceoftheminerals,ormetalsproduced,whichmayvarysignificantlyfromcurrentlevels.Thesevariations,ifmateriallyadverse,mayaffectthetimingorthefeasibilityofthedevelopmentofaparticularproject,theexpansionofcertainfacilitiesormines,orthecontinuationofexistingassets.

Otherfactorsthatmayaffecttheactualconstructionorproductioncommencementdates,costsorproductionoutputandanticipatedlivesofassets,minesorfacilitiesincludeourabilitytoprofitablyproduceandtransportthemineralsand/ormetalsextractedtoapplicablemarkets;theimpactofforeigncurrencyexchangeratesonthemarketpricesofthemineralsormetalsweproduce;activitiesofgovernmentauthoritiesinthecountrieswherewesellourproductsandinthecountrieswhereweareexploringordevelopingprojects,facilitiesormines,includingincreasesintaxes;changesinenvironmentalandotherregulations;thedurationandseverityoftheUkraineconflictandtheCOVID-19pandemicandtheirimpactonourbusiness;politicaluncertainty;labourunrest;andotherfactorsidentifiedintheriskfactorsdiscussedinsection9.1oftheOperatingandFinancialReviewintheAppendix4EandBHP’sfilingswiththeU.S.SecuritiesandExchangeCommission(the‘SEC’)(includinginAnnualReportsonForm20-F)whichareavailableontheSEC’swebsiteat.

Exceptasrequiredbyapplicableregulationsorbylaw,BHPdoesnotundertaketopubliclyupdateorreviewanyforward-lookingstatements,whetherasaresultofnewinformationorfutureevents.Pastperformancecannotbereliedonasaguidetofutureperformance.

Presentationofdata

Unlessspecifiedotherwise:operationsincludesoperatedassetsandnon-operatedassets;totaloperationsreferstothecombinationofcontinuinganddiscontinuedoperations;continuingoperationsreferstodatapresentedexcludingtheimpactsofOnshoreUSfromthe2017financialyearonwardsandexcludingPetroleumfromthe2021financialyearonwards;referencestoUnderlyingEBITDAmarginexcludethirdpartytradingactivities;datafromsubsidiariesareshownona100percentbasisanddatafromequityaccountedinvestmentsandotheroperationsispresented,withtheexceptionofnetoperatingassets,reflectingBHP’sshare;mediumtermreferstoourfiveyearplan.Numberspresentedmaynotadduppreciselytothetotalsprovidedduetorounding.Allfootnotecontent(exceptintheAnnexures)iscontainedonslide27.

Non-IFRSinformation

WeusevariousNon-IFRSinformationtoreflectourunderlyingperformance.ForfurtherinformationpleaserefertoNon-IFRSfinancialinformationsetoutinsection11oftheOperatingandFinancialReviewintheAppendix4Efortheyearended30June2022.

Noofferofsecurities

Nothinginthispresentationshouldbeconstruedaseitheranofferorasolicitationofanoffertobuyorsellanysecurities,orasolicitationofanyvoteorapproval,inanyjurisdiction,orbetreatedorrelieduponasarecommendationoradvicebyBHP.NoofferofsecuritiesshallbemadeintheUnitedStatesabsentregistrationundertheU.S.SecuritiesActof1933,asamended,orpursuanttoanexemptionfrom,orinatransactionnotsubjectto,suchregistrationrequirements.

Relianceonthirdpartyinformation

Theviewsexpressedinthispresentationcontaininformationthathasbeenderivedfrompubliclyavailablesourcesthathavenotbeenindependentlyverified.Norepresentationorwarrantyismadeastotheaccuracy,completenessorreliabilityoftheinformation.ThispresentationshouldnotberelieduponasarecommendationorforecastbyBHP.

BHPanditssubsidiaries

Inthisrelease,theterms‘BHP’,the‘Company,the‘Group’,‘BHPGroup’,‘ourbusiness’,‘organisation’,‘we’,‘us’,‘our’andourselves’refertoBHPGroupLimitedand,exceptwherethecontextotherwiserequires,oursubsidiaries.Refertonote28‘Subsidiaries’oftheFinancialStatementsintheAppendix4Eforalistofoursignificantsubsidiaries.Thosetermsdonotincludenon-operatedassets.ThisreleasecoversBHP’sfunctionsandassets(includingthoseunderexploration,projectsindevelopmentorexecutionphases,sitesandclosedoperations)thathavebeenwhollyownedand/oroperatedbyBHPorthathavebeenownedasajointventure1operatedbyBHP(referredtointhisreleaseas‘operatedassets’or‘operations’)duringtheperiodfrom1July2021to30June2022.

BHPalsoholdsinterestsinassetsthatareownedasajointventure1butnotoperatedbyBHP(referredtointhisreleaseas‘non-operatedjointventures’or‘non-operatedassets’).Notwithstandingthatthisreleasemayincludeproduction,financialandotherinformationfromnon-operatedassets,non-operatedassetsarenotincludedintheBHPGroupand,asaresult,statementsregardingouroperations,assetsandvaluesapplyonlytoouroperatedassetsunlessstatedotherwise.

1.Referencesinthisreleasetoa‘jointventure’areusedforconveniencetocollectivelydescribeassetsthatarenotwhollyownedbyBHP.Suchreferencesarenotintendedtocharacterisethelegalrelationshipbetweentheownersoftheasset..

WesternAustraliaIronOresitetour

3October20222

Portfoliopositivelyleveragedtomegatrends

Lowcostassetsandworldclassresourcebaseacrossadifferentiatedsetofcommodities

Portfolio

Population

growth

Urbanisation

Risinglivingstandards

Decarbonisingpower

Electrifyingtransport

Geopoliticalrisk

30/30year

growth

BHP1.5OC

scenario

Copper

Largestendowment1

+

++

+++

+++

+++

~

>2x

Nickel

Secondlargestsulphide

resource2

+

++

+++

+

++++

+

~4x

Steel

Lowestcostironore3

Leadingmetcoalsupplier

+

+++

++

++

~

~

~2x

Potash

Large-scaleresourcesupportsupto100yearsofoperation4

+++

+

+

~

~

+++

>2x

2050estimate,changefromcurrent

~10bn

totalpopulation;

+2?bn

~7bn

urbanpopulation;

+2?bn

~$400tn

worldGDP;

4-foldgain

?ofpower

capacity

wind&solar;13-foldenergygain5

~2bn

EVsontheroad;

100-foldgain

-

+Indicatorsareversusabaselinethatdoesnotincludethethemebeingassessed.~Signifiestrivialdirectimpactoroffsettingforcesthatarebasicallyinbalance.

WesternAustraliaIronOresitetour

3October20223

Traditionalapplication

Decarbonisation&

Climateadaptation

Buildings&infrastructure

Cumulativesteeldemandrangesandscenarios

(30yr/30yr,%)

250

Climateadaptation

200

BHPplanningrange

150

100

50

0

1.5degreesDeepGreen~2degrees~3degreesClimateCrisis

Source:BHPanalysis,VividEconomics.

Note:Ourportfolioistestedacrossarangeoffuturescenarios,includingascenariowherewarmingislimitedto1.5°C.ScenariosweredevelopedpriortotheimpactsoftheCOVID-19pandemic,andthereforeanypossibleeffectsofthepandemicwerenotconsideredinthemodelling.

Steelisthebuildingblockofabetterworld

Differentclimatescenariosdonotproducehighlydivergentoutcomes

Transportation&machinery

Renewableenergy

WesternAustraliaIronOresitetour

3October20224

Cropneedsperhead

Steeldemandperhead

Primaryenergyperhead

Essentialvaluechainshavedifferingdemanddrivers

Eachisessentialtoourwayoflifeandhasadistinctiverelationshiptoeconomicdevelopment

Foodvaluechain

PopulationgrowthanddietarychangeFood,feed,fibre,fuel

Lowdegreeofrecycling1

Steadyincreaseinintensitythroughtheentiredevelopmentjourney,highincomeplateau

GDPperhead

Traditionalgrowthdrivers

Steelvaluechain

Urbanisationandindustrialisation

Buildings,infrastructure,machinery,othergoods

Highdegreeofrecycling

Swiftincreaseinintensityonthewaytomiddleincome,whereadistinctpeakforms

GDPperhead

MajorusesbysocietyDegreeofCircularity

Energyvaluechain

Motorisation,electrification,industrialisationTransport,power,heat,chemicals

Lowdegreeofrecycling

Swiftincreaseinintensityonthewaytomiddleincome,flatterbeyond,highincomeplateau

GDPperhead

Relationshiptolivingstandards

Note:Illustrativeonly,reflectingstylisedempiricalpathofmajorsocietiesthroughtimethathavereachedhighincomelevels.

1.Recyclingofnutrientsviacropresidueormanureoccurs,butthefoodvaluechainisveryinefficientandhighlysubjecttowaste.

WesternAustraliaIronOresitetour

3October20225

100%

75%

50%

25%

0%

100%

75%

50%

25%

0%

Industryhasdistinctivecompositionineachmajorregion

Heterogeneityinformsourapproachtolongrunforecasting,withemphasisonabottom-upmethodology

Steeldemandbybroadend-use

100%

75%

50%

25%

0%

IndiaChinaJapanGermanyUSA

ConstructionManufacture&others

Steelsupplybybasicprocess&fleetage

100%

75%

50%

25%

1812444563

0%

IndiaChinaJapanGermanyUSA

BOFEAFXXaverageage*

Steelsupplybymetallicmix

IndiaChinaJapanGermanyUSA

PigironDRIScrap

Netexports:directandindirect,%output

40%

20%

0%

(20)%

(40)%

IndiaChinaJapanGermanyUSA

DirectsteelIndirectsteel

Ironore:domestic&importedsources

IndiaChinaJapanGermanyUSA

ImportDomestic

Scrapimportdependency

40%

20%

0%

(20)%

(40)%IndiaChinaJapanGermanyUSA

Netimport

Source:WorldSteel,UnitedNation,GlobalTradeAtlas,BHPanalysis.*Capacityweightedestimateofintegratedsteelmakingfacilities,basedonasample,notaCensus.GermanyisEUandUSisNorthAmericaforthismetric.

WesternAustraliaIronOresitetour

3October20226

18

2021actuals

2050

15

2040

2030

12

2021

9

2050

6

2010

2040

China1990

2000

2050

3

Stockofsteelperheadplateausathighincomelevels

Rangeofend-statesintermsofcapitalstockdeptharerelativelynarrow,butpathstotheend-statearediverse

Accumulatedstockofsteelinusepercapita

(tonnesfinishedsteel/capita)

2040

2030

2030

2021

2021

2010

0

OtherAsia

India1990

0

60

50

developing

1990

10

203040

USA1950-2021

Korea1970-2021

Germany1950-2021Japan1950-2021

GDPpercapita(PPP)

Source:BHPanalysis;GlobalInsight;UnitedNation;worldsteel.

AsiandevelopingcountriesincludeASEANandotherAsiandevelopingcountries.

WesternAustraliaIronOresitetour

3October20227

800

600

400

200

0

1,600

1,200

800

400

0

50

01950197019902010

Stocklevelsultimatelyconverge,butrunratesarediverse

China’spost-plateaurun-ratetrajectoryremainsuncertain,withdiverseexamplesfromeconomiesalreadyatthehighincomelevel

Steelproductionbyregionperhead

(kg)

Continentalscalepowers

Industrialpioneers

World

800

600

400

200

0

800

300

600

250

400

200

0

200

1950197019902010

1950197019902010

GermanyUKFrance

CISUSA

150

Advancedexporters

Populousemerginggiants

100

1950197019902010

1950197019902010

China

India

JapanKorea

Source:WorldSteel,UnitedNations,BHPanalysis.

WesternAustraliaIronOresitetour

3October20228

(Mt)

150

200

100

China:ayoung,advanced,coastalfleet

Newcapacitypositionedtoservicedynamicdomesticdemandcentresandsecurecompetitiveaccesstoimportedrawmaterials

Cumulativesteeldemandrangesandscenarios

MapofChinasteelprojects

Newlyaddedcapacity2018-2023byblastfurnacevolume

(30yr/30yr,%)

250

BHPplanningrange

50

150

0

Steelcapacity

100

>10Mt5-10Mt<5Mt

50

0

DeepGreen~2degrees~3degrees

1,000-2,000m3

2,000-3,000m3

>3,000m3

Source:BHPanalysis.

Note:Ourportfolioistestedacrossarangeoffuturescenarios,includingascenariowherewarmingislimitedto1.5°C.ScenariosweredevelopedpriortotheimpactsoftheCOVID-19pandemic,andthereforeanypossibleeffectsofthepandemicwerenotconsideredinthemodelling.

ILLUSTRATIVEONLY

WesternAustraliaIronOresitetour

3October20229

India:themajorgrowthvectorforglobalsteel

Brownfieldoptionalityputsofficialtargetswithinreach;integratedsteelmakingtogainshareatexpenseofcoal-basedDRI

GrowingsteelcapacityinIndia

(Mt)

200

BF-BOFOthers

Cumulativesteeldemandrangesandscenarios

(30yr/30yr,%)

150

700

100

50

600

BHPplanningrange

0

500

ExistingConstructionPlanned

400

300

200

100

Existing

0

DeepGreen~2degrees

~3degrees

UnderconstructionPlanning/AnnouncedMineralrichstate

Source:BHPanalysis.

WesternAustraliaIronOresitetour3October2022

ILLUSTRATIVEONLY

Source:BHPanalysis.

10

400

40

20

0

SouthEastAsia:gearingupfordomesticdemand

Multiplecountrieswithintheregionarebuildingupcapacityathome,seekingtoreducehistoricalimportdependency

Cumulativesteeldemandrangesandscenarios

(30yr/30yr,%)

MapofSEAsiasteelprojects

BurgeoningsteelcapacityinSEAsia

500

(Mt)

80

60

BHPplanningrange

300

Steelcapacity

200

100

Existing

0

DeepGreen~2degrees~3degrees

Underconstruction

Planning/Announced

Source:BHPanalysis.

ILLUSTRATIVEONLY

Source:SEAISI.

WesternAustraliaIronOresitetour

3October202211

Steelanetbeneficiaryofdecarbonisation&climate

Netimpactofdecarbonisingpowerandphysicalimpactsofclimatechangeisamodestupliftinmediumandlongtermdemand

Globalfinishedsteeldemandin2030&2050bydriver

(milliontonnes)

Weestimateamodestupliftinourbasecaseforsteeldemandinboth2030and2050fromthenetimpactoffourforces:

?Infrastructureofdecarbonisation[moresteel]

?Declineoffossilenergydemand[lesssteel]

?Highercapitalstockturnover[moresteel]

?Slowereconomicgrowthduetothephysicalclimateimpacts&carbonpolicies[lesssteel]

2030

17

28

11

+2%

(14)

Final

Initial

60

2050

73

+4%

(53)

Initial

(4)

Final

Macro/other

Capital

stock

turnover

CleanPower

FossilPower

WesternAustraliaIronOresitetour

3October202212

0

20152020202520302035204020452050

Nuclear

Hydro&otherrenewables

Solar

Windonshore

Windoffshore

Fossilfuel&others

58

45

Non-fossilfuelshareofsteeldemandinpowergen(%)

~100%

94%

15

Source:Hatch,ArcelorMittal.

Essentialforthedecarbonisationofpower

Steelconsumptioninpowerwilltriplefromtodaywithdemandfromwindandsolar5timesbigger

Renewableenergy

Renewablepowertendstorequiremoresteelcomparedtofossilfuels

(Steelt/MWofcapacity)

Globalsteeldemandfrompowergeneration

(Mtfinishedsteel,newcapacity+rebuild)

140

Windoffshore

Hydro

Windonshore

Nuclear

Coal

Solar

Gas

Oil

120

190

100

161

80

60

124

40

20

59

2050steeldemandin

PowerGenerationvs2020

Sharein2020<2%

3x5%

PowerGen%totalsteeldemand2050

2030

35

2050

2015

63%

WesternAustraliaIronOresitetour

3October202213

Capitalagesfasterunderclimateextremes

Shortercapitallifetimesandhighercapitalstockturnoveraretheintuitiveoutcomesofaharsherphysicalclimate

Capitalageslinearlyastemperaturesrise…

Capitaldepreciationrate1

(%)

MeantemperatureHotter

…buttherelationshipismorecomplexwithrespecttoprecipitation

Capitaldepreciationrate1

(%)

DryerAnnualprecipitationWetter

Theresultswepresentoncapitaldepreciationaregeneralandabstractinnature,beingestimatedatthewholeofcapitalstocklevel,eithernationallyorregionally,inadditiontobeingbasedonaverageclimateparametersatthesamelevelofaggregation.Therefore,theyarenotappropriateforaccountinguseforspecificassets,wherelocalclimaticandotheridiosyncraticfactorswillbeinplay.UnderlyingdatasourcedfromthePennWorldTable,analysisbyBHP.

WesternAustraliaIronOresitetour

3October202214

Globalscrapratiotorisesteadilytowards“50in50”

Globalratiowillreachandsurpasspre-Chinaboomlevels,asend-of-lifescrapavailabilityinChinamorethandoublesby2050

Globalsteel

(Mt)

productionandscrapconsumption1

Regionalscraptosteelratio

(ratio2%)

(ratio2%)

2,500

2,000

1,500

1,000

500

6060

50

50

40

40

30

30

20

20

1010

000

199020002010202020302040205020102020203020402050

Steeloutput(Mt)Scrapusage(Mt)Globalscraptosteelratio(%,RHS)ChinaIndia&otherdevelopingAsiaRestofWorld

Source:BHPanalysis.

1.Scrapconsumptionisnetofestimatedconsumptioninfoundrysectorandisbasedonsteelproductionandconsumption.

2.Scrapconsumption/crudesteelproduction.

WesternAustraliaIronOresitetour

3October202215

Ironorerangeisresilient,butnotablylowerthansteel

Alternativemetallicscompetewithprimaryoreincomingdecades

Theevolutionofcontestabledemand:~2degrees

(%)

Cumulativesteelandironoredemandrangesandscenarios

(30yr/30yr,%)

250

77%

Steel(ironoreplusothermetallics)Ironore

69%

200

59%

BHPsteel

planningrange

China

150

BHPironore

planningrange

Others

100

7%RoW

Europe

DevelopedAsia

DevelopingAsia

5%7%

3%

6%

50

7%

11%

11%

17%

12%

8%

2%3%14%ted

1%

202120352050

0

202120352050

1.5degreesDeepGreen~2degrees~3degreesClimateCrisis

Source:BHPanalysis.Contestabledemand=Globalseaborne+Chinadomestic.

Source:BHPforallscenarios,VividEconomicsfor1.5degrees.

Note:Ourportfolioistestedacrossarangeoffuturescenarios,includingascenariowherewarmingislimitedto

1.5°C.SomescenariosweredevelopedpriortotheimpactsoftheCOVID-19pandemic,andthereforeany

possibleeffectsofthepandemicwerenotconsideredinthemodelling.Theyarepresentedhere“asis”.

WesternAustraliaIronOresitetour

3October202216

1,826

1,800

1,200

600

0

Lowexpectationsofthelate2010swerenotfulfilled

Consensusviewsofironoreindustrydevelopmentpre-Brumadinhowereapoorpredictorofactualperformance

Contestabledemand

(Mt)

+125

1,701

CY21forecastin2018CY21Actual

Majors’seaborneexports

(Mt)

1,800

–79

1,355

1,275

1,200

600

0

CY21forecastin2018CY21Actual

Juniors’seaborneexports+China’sdomesticironoreproduction

(Mt)

1,800

1,200

600

0

+183

588

405

CY21forecastin2018CY21Actual

ChinaDevelopedAsiaOthersBHPAustraliaothersBrazilChinaJuniors

Source:1)WoodMackenzie.“Before”wassourcedfromtheCY2018Q3longtermforecastbeforetheBrumadinhotragedy.“Now”usetheversionofCY2022Q2longtermforecast.

2)BHPoperationalreviewforthehalfyearended31Dec2021.3)IHSGTA.

WesternAustraliaIronOresitetour

3October202217

Competitor

3

Competitor1

Competitor

2

40

20

0

02505007501,0001,2501,5001,7502,000

Reliabilityofsupplyishighlyvaluableinanuncertainworld

Accuratevolumeguidance,deliverytospecifications,competitivepricerealisation,durablylowcostoperationsandattractivemargins

Performanceversusguidancemixedacrosstheindustry

(%,averagevariationfrominitialguidancemidpoint,FY14-FY21)

2030–BHPprojectedtoremainthelowestcostmajorproducer

(CFRChina,62%FeFinesequivalent,US$/drytonne)

2.0

1.0

0.0

(1.0)

(2.0)

(3.0)

(4.0)

(5.0)

(6.0)

100

80

60

BHPCompetitor1Competitor2Competito