BHP Group Limited reported that copper has become its largest earnings contributor, generating $18.19 billion of underlying EBITDA in the year ended June 30 and overtaking iron ore’s $14.53 billion. The company’s underlying attributable profit rose 30% to $13.2 billion, exceeding consensus estimates of $12.66 billion. Australian shares climbed as much as 4.2% to a two-month high following the announcement.
The company strengthened its financial position by reducing net debt to $8.69 billion and raising its FY2026 dividend to $1.72 per ordinary share, the highest in four years. BHP’s capital allocation strategy reflects the shift toward copper, with more than half of its expected medium-term annual capital and exploration spending of about $11 billion directed toward copper growth. The company estimates its project pipeline could increase attributable copper production by approximately 40% by fiscal 2035.
BHP produced approximately 2 million metric tons of copper for a second consecutive year and describes itself as the world’s largest copper producer. The company expects copper-growth initiatives to be self-funding at consensus commodity prices. Underlying the earnings increase was a 35% rise in average realized copper price to $5.74 per pound, while copper byproducts including gold, silver, and uranium contributed $4.5 billion of revenue, up 45%.
The demand outlook supports a longer-term growth narrative. BHP expects global copper demand to expand from 34 million metric tons in 2026 to more than 50 million by 2050, driven by expanding power networks and data centers. If the company’s copper pipeline delivers its targeted approximately 5% annual attributable copper-equivalent growth from fiscal 2027 through fiscal 2035, it could support a growth investment thesis rather than a purely cyclical narrative.
However, near-term execution risks remain. Final investment decisions for projects including Vicuña Stage 1 and Escondida’s new concentrator lie ahead, while other growth initiatives are still under evaluation. Iron ore continues to provide substantial cash flow and flexibility as BHP pursues its copper-expansion program.
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