Going on a crash diet seems great while you’re shedding the pounds. The problem is sticking with it for the long term. That’s what seems to be happening to the world’s miners, which have spent the years since the commodity boom peaked in 2011 holding down salaries, eking out efficiencies and extracting the highest-quality parts of their deposits to keep costs in line with deflating prices. The cycle looks to be turning, though. Controllable cash costs at BHP Billiton rose by $1.24bn in the year to end-June, the company reported on Tuesday, mainly because of declines in oil and gas fields, operational problems at two coking coal mines and issues around processing costs at two copper mines. That was enough to overwhelm the $1.02bn gain to earnings before interest, tax, depreciation and amortisation (ebitda) from higher volumes at the company’s two biggest operations, the Escondida copper mine and its Australian iron ore business. BHP isn’t alone in this. At Rio Tinto Group, operating ...
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