The chief executive of BHP Billiton, the world's biggest miner, warned that the market was overestimating the ability of the industry to bring on new mines and relieve high metals prices.

Speaking as he unveiled strong full-year results, Marius Kloppers, chief executive of BHP, said that rising production costs and financing diffulties were leading to delays at new projects and threatening miners' profit margins.

"Please look at the supply scenario again. In our view, across our suite of commodities, the supply situation is still being overestimated."

His comments come amid a sharp derating of the sector this year, even as miners have reported record-breaking earnings. Some analysts say the derating reflects bearish forecasts on global industrial demand and overly optimistic expectations over how quickly new supply will come on line as big and small miners work to deliver a wave of new mines from 2014.

Mr Kloppers said these trends would "on balance, over time" be a good thing for BHP because supply-side pressures would support today's high prices for metals.

"Yes, we understand that cost inflation is coming; yes, we understand that some people's perception in some parts of the market is of a softer demand scenario," Mr Kloppers said.

Earlier this month Tom Albanese, Rio Tinto's chief executive, also highlighted the challenges faced by miners of bringing on new supply.

Gayle Berry, a base metals analyst at Barclays Capital, said of the outlook for copper supply: "The mine-supply side of the market is extremely weak. There are certainly new projects on the horizon, but the timing and realisation of those coming to the market is questionable."

BHP plans to spend $80bn over the five years to 2015 to build new mines and expand old mines. Like its peers, BHP is channelling its large cash flows into project development. However, BHP said on Wednesday that higher material, labour and other costs had reduced the miner's underlying earnings before interest and tax by $1.2bn, compared to a total of $32bn.

The miner on Wednesday reported a 60 per cent rise in pre-tax profits from $19.6bn to $31.3bn in its fiscal year ending in June. BHP attributed the results to "another strong year of growth in Chinese crude steel production", adding that it expected robust demand in the short and medium term for commodities.

BHP's earnings per share rose to 426.9 cents from 227.8 cents. Revenues rose to $71.7bn from $52.7bn.

The miner raised its final dividend by 22 per cent to 55 cents, carrying the annual dividend to $1.01 per share, but did not start a new share buy-back programme after completing its $10bn buy-back in June.

David Fuller's view In the commodity supercycle, I maintain that BHP (monthly, weekly & daily) and other top miners are growth stocks, rather than cyclicals. BHP is a core holding in my personal long-term investment portfolio. It sits on a treasure trove of world-class resources in the ground and the dividend is now nearly 3%.