BHP Billiton, the world's largest miner, today gave a guarded outlook for global commodity demand, sending a worrying signal for weaker rivals, after a slump in metals prices triggered its first profit decline in seven years.

While the mining sector has suffered from the global economic slump, forcing companies to idle capacity and delay expansion projects, BHP is seen well positioned with a strong balance sheet to take advantage of any upturn.

Chief executive Marius Kloppers said the past 12 months were the toughest he'd seen, and it would be hard to tell whether real demand has recovered until next year.

“Over a 12-month period, we went from a situation where rampant demand couldn't be satisfied to where demand simply evaporated and, lately, stabilisation,” he said.

“It'll be 2010 before we see a clean set of underlying demand figures, without all these stocking movements,” Kloppers added.

BHP said demand in China and India had returned earlier than many had expected, driven mainly by restocking, but it noted the rebuilding of stocks in China was now largely over.

It also left a question mark over signs of a pick-up in developed markets.

BHP's net profits before one-off factors fell to US$4.59 billion (£2.78 billion) in the first half of the year from $9.37 billion the year before.