BHP Billiton on Wednesday said it is seeing signs of recovery in commodities markets but cautioned that supply was still running ahead of demand amid stronger-than-expected steel consumption in China.
"We have seen early signs of markets rebalancing," the mining firm said.
"Fundamentals suggest both oil and gas markets will improve over the next 12 to 18 months. Iron ore and metallurgical coal prices have been stronger than expected, although we continue to expect supply to grow more quickly than demand in the near term," the company said.
BHP said it was on track to meet its fiscal 2017 production guidance for iron ore of 265 million to 275 million tonnes versus 257 million tonnes last year.