BHP Group faces share pullback amid potential iron ore stake sale

BHP Group Ltd has experienced a recent share price pullback, dropping 7.5% over the past week and trading nearly 10% below its August high. This decline follows the company trading ex-dividend after declaring a final dividend of 99 US cents per share.

Reports indicate that China's Baowu Steel Group may be interested in acquiring a 15% to 25% stake in BHP's Jimblebar iron ore mine in Western Australia. While BHP has not confirmed the deal, the company stated it regularly explores options to create long-term shareholder value. The potential involvement of a Chinese state-owned entity has drawn scrutiny from Australian politicians.

Despite the recent volatility, BHP's financial position remains robust, with an underlying EBITDA of approximately US$33 billion and an attributable profit of US$9.8 billion for FY26. A significant shift in the company's earnings mix is underway, as copper now accounts for more than half of its underlying EBITDA. Management expects to increase copper production by roughly 40% by FY35.

In the broader Australian mining sector, Mineral Resources Ltd has seen its share price rise 12.6% since the start of 2025, focusing on lithium and iron ore extraction.