By Cecile Lefort
SYDNEY, Feb 2 (Reuters) - Ratings agency Standard & Poor's lowered the credit ratings of BHP Billiton (L:BLT) Ltd BHP.AX to A from A-plus and placed the mining giant on credit watch negative due to very challenging market conditions for iron ore, oil and copper prices.
A further downgrade by one notch will depend on BHP's dividend policy and capital expenditure guidance due out this month, S&P said, adding to speculation the miner may have to lower its payout to shareholders.
The rating on BHP Billiton's senior secured notes has been lowered from A+ to A and subordinated notes from A- to BBB+.
The ratings action follows the agency's price assumptions for commodities, S&P said.
Iron ore, Australia's top export earner, has recently dropped to its lowest in over a decade.
Yet, BHP Billiton remains one of the highest rated mining companies.