Mining giant BHP Billiton (AXS: BHP) warned on Thursday that the mining industry faces short-term instability over eurozone instability and concerns on China's growth. To address this situation, he said the company will instead focus on volume instead of price.

"We do not anticipate a repeat of the record prices experienced over the past decade. This shortage of low-cost supply us now well advanced towards being filled and we are now witnessing a rebalancing of demand and low-cost supply," English Capital quoted BHP Chief Executive Marius Kloppers in his address to shareholders are BHP's yearly general meeting in London.

"The opportunities that lies ahead will be volumetric as opposed to price based," he pointed out.

Mr Kloppers forecast that demand for commodities will continue to grow by 50 to 80 per cent in the next 15 years as growth in China and other developing nations would be investment led. While he foresees an eventual moderation of demand for iron ore and coal, he expects higher demand for copper and other energy products.

He recalled that miners responded to the unsustainable high prices for certain commodities in the past years by building new production capacity to address to high demand from China and other countries. However, things changed when China and other developing economies shifted to consumption-led growth instead of infrastructure-led growth.

Mr Kloppers said the slump in demand was worsened with government policies such as Australia's mining tax and strong currency which added to escalating costs.

He sought more collaboration between the industry and governments to support efforts to slash costs to address lower demand by reining in on demands for higher royalties and taxes as well as more regulation.

He cited the decision of the Queensland government to increase royalties for coal miners to raise $1.6 billion more for the state budget over four years. He said the higher royalties would definitely affect BHP's future investment decision. Mr Kloppers emphasised that miners alone cannot lift the industry on competitiveness alone.

"We accept that it is our role to carry the bulk of this task (of cutting costs) . . . Governments must also play their part in ensuring that those elements of the cost environment they control provide a competitive framework within which future investment is encouraged.

Due to lower commodity prices and high operating costs, BHP shelved its uranium mining expansion plans in August and other projects worth at least $40 billion.

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