iron ore price settlement, page-7

Its all set in stone now.....9.5% agreed
Baosteel, BHP agree iron ore price


www.chinaview.cn 2006-12-25 13:15:42


BEIJING, Dec. 25 -- Baosteel Group, China's largest steelmaker, said Saturday it had agreed to pay 9.5 percent more for iron ore from Australian miner BHP Billiton.

The deal follows a similar agreement with Brazilian miner Companhia Vale do Rio Doce, or CVRD, signed Thursday in Shanghai.

The price rise, agreed late Friday, would take effect from April, 2007, Baosteel said in a statement.

Baosteel represented the domestic steel industry in negotiations with the miners. This is the first time that China has set the industry's benchmark price, which is then typically accepted by other miners and steel mills.

Iron ore prices have risen thanks to rapid growth in demand from the domestic steel industry, the world's largest, which is on track to produce about 420 million tons of crude steel this year.

Global iron-ore contract prices have increased for four consecutive years. They increased 19 percent in 2004, 71.5 percent the following year and 19 percent in 2006.

(Source: Shenzhen Daily)