Sydney, Jan 21, 2026, 16:51 AEDT — Market closed.
- BHP rebounded 1.5% following a steep decline the previous day.
- Iron ore pricing talks with China and a new rise in Jansen potash costs caught investors’ attention.
- Attention now turns to contract terms in China and BHP’s half-year results set for Feb. 17.
BHP Group (BHP.AX) shares ended Wednesday 1.47% higher at A$48.48, bouncing back after losing 1.99% on Tuesday. The stock fluctuated between A$47.25 and A$48.50 throughout the session. 1
The rebound came after BHP’s latest operating update sparked a sharp selloff. The company warned of price concessions on certain iron ore sales amid talks over a 2026 supply deal with China Mineral Resources Group (CMRG), the state-backed buyer. RBC analyst Kaan Peker noted these restrictions could “likely tighten spot market availability and support the headline index price,” despite BHP having to offer “higher discounting” on some products. 2
BHP highlighted stronger prices for its top two metals. Copper prices climbed 32% year-on-year, while iron ore edged up 4%. The miner reported record first-half production and shipments from its Western Australia iron ore operations, alongside operational highs across its copper portfolio. Chief Executive Mike Henry described it as “another half of very strong performance” and raised the lower bound of its copper output guidance for fiscal 2026.
The bigger headache is Jansen, BHP’s marquee potash project in Canada, designed to diversify earnings beyond iron ore and copper. A recent filing revealed BHP has raised its total Stage 1 investment estimate to $8.4 billion, citing extra construction hours, materials costs, inflation, and productivity setbacks. Stage 1 is now 75% complete, with first production still slated for mid-2027. Brandon Craig, President Americas, described Jansen as “an important pillar” in BHP’s long-term growth plan. 3
Investors in the sector are weighing execution and pricing across Pilbara following Rio Tinto’s recent production report, which surpassed expectations. Barrenjoey analyst Glyn Lawcock pointed to weaker iron ore pricing at Rio, noting: “The only thing I’d call out was the pricing in iron ore was weaker than BHP year on year and sequentially.” 4
BHP bucked the trend on a softer local market. Australian shares slipped on Wednesday, with the S&P/ASX 200 shedding 0.37%, dragged down by weakness in tech and consumer sectors despite some pockets of strength. 5
BHP relies heavily on iron ore, and traders are keen to see if the ongoing talks in China will lead to broader discounts or firmer buying conditions in the market. The “realised price” reflects the average a miner nets after factoring in product quality and contract specifics — often diverging significantly from the headline iron ore index.
There’s a flip side. Rising potash prices could push returns and payback timelines further out, shifting the market’s view of Jansen from a growth asset to a burden on capital discipline. A weather disruption in the Pilbara or a sharp drop in Chinese steel demand would hit shipments and cash flow hard and fast.
Investors are now eyeing any updates on the China supply discussions. Attention will also turn to BHP’s half-year results on Feb. 17, where the company is expected to reveal new details on pricing, costs, and spending strategies.
