BHP stays neutral amid U.S.–China critical minerals showdown

BHP Group chair Ross McEwan said that Washington and Beijing are “just flexing their muscles” over critical metals and that BHP will keep working with both sides as supply chains tighten.

McEwan addressed shareholders at BHP’s annual meeting in Melbourne on October 23, describing two “very powerful nations” competing for leverage across battery and defense supply chains. The comments came days after an announcement of U.S.–Australia critical-minerals agreement aimed at diversifying away from China’s processing dominance. BHP, a major producer of copper and iron ore with exposure to nickel and metallurgical coal, is positioned to navigate policy shifts while preserving access to both markets. 

The U.S.–Australia agreement seeks to accelerate development and processing of key inputs – lithium, nickel, cobalt, rare earths, graphite and manganese – so downstream industries are less exposed to single-country chokepoints. Analysts note the pact highlights how far Western capacity trails China’s entrenched refining footprint.

Beijing has tightened outbound controls on strategic materials since 2023. These include export licensing on gallium and germanium, permit requirements for certain graphite grades, and curbs tied to rare-earth magnets, measures that complicate U.S. and allied supply strategies. In April 2025, the country expanded restrictions to seven rare earth elements used in EVs, wind turbines and guided systems.

China controls the majority of global lithium refining capacity; the IEA places processing dominance with China among the top suppliers, while market tightness flared in August after a shutdown at Yichun – mines that account for about a quarter of China’s and roughly 12% of global lithium supply – triggering an ~8% price jump. The U.S. – Australia framework aims to diversify refining away from China over the next build cycle.

A price slump driven by Indonesian supply growth forced BHP to suspend Western Australia’s Nickel West (refinery, smelter and mines) and pause West Musgrave in 2024, undercutting non-Chinese/Indonesian midstream options just as the West seeks diversification. IEA and other trackers note Indonesia dominated additions to nickel refining capacity since 2020.

Executives from BHP said the United States is “fiercely” focused on building new mining and processing capacity, with projects like the Resolution copper venture in Arizona cited as potential pillars of domestic supply. BHP also reiterated its core focus on copper, iron ore and steelmaking coal, even as critical-minerals policy reshapes the landscape. 

At the same meeting, BHP warned that more “difficult decisions” may be needed in its Australian metallurgical coal business amid state royalty settings and market conditions, following a Queensland suspension and job cuts announced earlier. The company also said it isn’t currently in government-to-government talks on new critical-minerals projects but remains open to proposals.