cost overrun & delay...smh news, page-36

re: azr quartely report tomorrow mike123,

AZR has good management and the outlook for Iron Ore is pretty okay. Maybe it isn't going up 200% in the next 6 months like some mining stocks will, but AZR is very soon to become a producer which pays during booms. Easy money, I reckon. Have a bit of patience.

cheers, mm

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http://metalsplace.com/metalsnews/?a=4767

The president of Brazilian mining giant Companhia Vale do Rio Doce, or CVRD, said Monday that China continued to be the engine driving global iron ore demand in March.

Quoted by the local Estado news agency, CVRD President Roger Agnelli said, " China's demand for iron ore in March was a record." According to Agnelli, Chinese iron ore demand grew 28% in March compared with the same month a year ago.

Agnelli made the comments on the sidelines of an awards ceremony for the Brazilian Advertising Association, or ABPO, in Rio de Janeiro.

With demand continuing to be strong, the natural evolution is for iron ore prices to keep rising, Agnelli added.

"Demand continues to be strong, and the tendency is for prices to rise. This is natural, there's nothing much to discuss," Agnelli said.

In March, Agnelli took the unusual step of confirming that the company was seeking a 24.6% increase to 2006 price contracts.

"We think that the 24% increase we put on the negotiating table is a number that, conclusively, is consistent, is justified," Agnelli said.

Global steelmakers are resisting efforts by CVRD, BHP Billiton and Rio Tinto, who control 70% of the seaborne iron ore market, to again raise prices. In 2005, the companies wrangled a 71.5% price hike from steelmakers.

However, miners have pointed that continued global economic growth, led by urbanization in China, has maintained the current imbalances between iron ore supply and demand. Furthermore, the companies said they need to raise prices to fund a surge in investments needed to meet the increased global demand for iron ore.

While the negotiations have been difficult, the fact that iron ore miners and steelmakers have not reached an accord at this point is not very worrisome, Agnelli said.

"In 2001, for example, we reached a price in May," Agnelli said.

Agnelli said the company is continuing the negotiations, which are following a "natural" course, with a multitude of Chinese steelmakers.

"There are many steel companies. Until they arrive at a consensus, a deal will be delayed a little more," Agnelli said.