BHP restructures Australian iron ore unit after cutting 300 jobs
By Liezl GambeKey points
- BHP plans to overhaul its Western Australia Iron Ore division after already eliminating 300 on-site roles.
- Rising operational expenses and softer iron ore prices near US$90 a tonne are squeezing mining profit margins.
- New CEO Brandon Craig aims to simplify management structures and extend cost-cutting efforts across other divisions.
BHP (ASX:BHP) reportedly plans to restructure its Western Australia Iron Ore unit after cutting 300 on-site jobs to lower expenses.
The overhaul expands cost-reduction efforts started under former chief executive Mike Henry as benchmark prices sit near US$90 a tonne.
Sources familiar with the private plans stated the division employs over 16,000 workers and faces further white-collar reductions.
BHP plans to move technology and support teams directly under mining assets and examine job cuts across other divisions.
Following the announcement, the BHP share price was unchanged at $59.61.
Rival Rio Tinto (ASX:RIO) has similarly combined overlapping roles to combat climbing costs and cooling Chinese steelmaking demand.
BHP reported Pilbara mining expenses of UD$16.40 a tonne last financial year, compared to Rio Tinto’s US$25 unit cost.
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