China's strong demand for commodities is sustainable over the long term, according to the world's largest miner, BHP Billiton Ltd./Plc., , which has an increasing exposure to the booming nation.

Sales to China rose to 9.8 percent of BHP Billiton's revenue in the year ended June 30 from 6.9 percent the previous year, with demand for iron ore keeping the miner operating at full capacity.

"We believe the demand for commodities in China is sustainable over the long term ... (although) China, as with any economy, will have bumps and bruises along the way," Chief Executive Chip Goodyear told the group's annual meeting.

His comments came amid concerns that China's efforts to control its booming economy may hurt companies that feed it, and as the world's most populous nation produced a third consecutive quarter of slower growth -- albeit still up 9.1 percent from a year earlier.

BHP Billiton is expected to post a strong profit increase this year because of higher production and strong commodity prices. Analysts forecasts centre on a net profit before one-off items of more than $5 billion, up 42 percent from the 3.51 billion posted in the year to June 2004, which was itself up 83 percent on the previous year.

"If anything, the market was pretty pleased with the commentary. Things still seem to be holding pretty strong," Daiwa Securities analyst Mark Pervan said after the annual meeting.

"I think the next issue for mining companies is going to be the lagging effect of cost pressures."BHP Billiton's shares closed 1.2 percent firmer at A$13.97 in a wider market up 0.1 percent.

(From Reuters, October 22, 2004)

____________