BHP’s next leader faces same problems in deal-obsessed industry

But just like his predecessor, Brandon Craig will have to navigate an industry under pressure to grow — placing bets on deals as a means to get there, or continuing along BHP’s stated path of building more mines.

In his first comments since being unveiled as CEO-elect, Craig sent a message that echoed his predecessor Mike Henry, as he played down expectations that BHP would pursue deals to achieve the scale that some investors crave.

Yet the mining industry is in the midst of a great strategic shift. Executives at the biggest mining companies, including BHP and Rio Tinto, are growing increasingly concerned that stagnant market valuations have them struggling for relevance, even as the geopolitical focus on critical minerals grows.

Both companies have tried repeatedly to buy smaller rivals in the past two years, with Rio twice holding talks with Glencore and BHP twice trying to buy Anglo American.

While Henry will be remembered for an internal overhaul of BHP that strengthened its position in iron-ore and copper, the last three years of his tenure were dominated by his failed pursuit of Anglo. Despite claiming to have moved on, BHP’s second tilt at its smaller rival reflected an acceptance within the company that acquisitions will be the most viable way to deliver quick growth in copper.

Tacitly, Craig continued that message on Wednesday, emphasising the long-term strength of its own portfolio, but also signaling a willingness to do deals if the target is right.

“The primary focus is going to be delivering organic growth,” Craig said at a media conference in Melbourne on Wednesday. The company’s “projects are incredibly compelling and M&A would have to be very special to be able to compete with those options,” he added.

That the 53-year-old executive chose to prioritise continuity is perhaps no surprise for a qualified engineer with more than 25 years his belt at BHP. The South African-born, naturalised Australian has risen through the ranks and – for the last two years – been at the forefront of a key shift in the company’s direction.

Since March 2024, Craig has been president of BHP’s Americas business, overseeing an expansion of output at Escondida in Chile – the world’s largest copper mine – to the point where the metal for the first time contributed more than half of the group’s profit for the six months through December.

His appointment is “like putting the chief engineer of the copper engine in the driver’s seat,” said Marc Jocum, senior product and investment strategist at investment firm Global X Management Aus Ltd. “His skill set is tightly aligned with where we believe the future growth sits.”

This is important as BHP and other global other miners pivot toward a metal that is crucial to the energy transition and an AI-driven tech boom. The recent failed tie-up between Rio Tinto and Glencore had also focused largely on bulking up on copper, as well as boosting valuations to gain more relevance with global investors and politicians.

In his Americas role, Craig has shown he is no stranger to dealmaking through his oversight of the Vicuña copper joint venture with Lundin Mining in Argentina. In his remarks on Wednesday, however, he stressed the importance of “discipline” – a word he used at least eight times during the media conference — and identified existing relationships as another key focus.

These relationships, he said, would help “a shift in the center of gravity” for BHP. National governments “whether it’s in Chile, Argentina, Canada or the US” are striving to create favorable conditions for the investments needed to secure future supply of critical minerals — including copper and fertilizer products, he said.

Craig has also overseen development of the Jansen potash project in Canada, which is scheduled to begin operating in mid-2027.

Craig joined BHP in 1999 and ran some of the group’s coal mines, before establishing a global maintenance center for operations. In that role, he was known as a man of few words but would engage staff during townhalls, according to a person who worked alongside him.

He had a reputation for being supportive of his team, said the person, who asked not to be named discussing non-public matters. During a charity event, bosses were encouraged to dress as superheroes; Craig turned up as Deadpool, the Marvel Comics character played on screen by Ryan Reynolds, the person said.

Craig’s breakthrough role at BHP – head of the Western Australia iron-ore business – involved integrating rail and port operations with mining assets that fed China’s then-expanding steel industry. That relationship has soured in recent months after Beijing told steelmakers to halt purchases of certain products from BHP due to a dispute over long-term contracts.

Mending relations with China’s state-run iron-ore buyer is a pressing issue for BHP. Craig said management would “be getting across to China to engage” in the next few weeks – even before he formally steps into the role on July 1. But he also placed emphasis on relationships in the Americas and the strategic minerals that are needed for growth.

“Iron was always their cash cow and that’s not going to go away, but I think BHP would like to have more growth coming from copper,” said Sam Konrad, investment manager at Jupiter Asset Management in Singapore. “Given the relative price outlooks for copper and iron-ore, it’s likely that copper will become an ever-increasing portion of BHP’s earnings.”