Barnett Backs Away from BHP, Rio Attack

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Thursday, October 16th, 2014
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The West Australian premier has downplayed his verbal attack on BHP Billiton and Rio Tinto, claiming he never suggested the two mining giants were colluding.

Colin Barnett took an unprecedented swipe at the companies last week, saying they were “flawed in trying to manage the world price of a commodity” and telling them to “remember who your landlord is”.

On Tuesday, he lashed at them again in parliament, saying business and economic logic suggested the “normal reaction” to a falling iron ore price would be to cut back supply, not to increase it.

Mr Barnett said it was the latest example of “some sort of arrangement” between the two miners, following merger proposals and a plan to meld their Pilbara iron ore operations in 2009, which caused angst among Chinese steel mills.

But the premier has backed away from his earlier comments.

“I’m not suggesting the companies are dealing with each other, so if I created that impression, I regret that,” Mr Barnett said on Wednesday.

Rio chief executive Sam Walsh told a conference in Sydney he did not know where Mr Barnett was coming from as the government had approved its plans.

He also said the industry was cyclical and would recover, because demand would continue to be very strong through the urbanisation of developing countries.

The iron ore price has plunged almost 40 per cent this year.

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