bhp follows rio on iron ore settlements

BHP follows Rio on iron ore settlements

BHP Billiton Ltd, the world's third-largest iron ore miner, has settled on a price for the steel-making commodity in line with that received by rival Rio Tinto Ltd.

BHP Billiton has reached an agreement with Baosteel, which acts on behalf of China's steel industry, for an 79.88 per cent increase in the price of iron ore fines and a 96.50 per cent increase in the price of iron ore lump.

This is the sixth consecutive annual increase in iron ore prices, as demand for the steel making commodity continues to be driven by the rapid urbanisation of China and India.

"We will now seek to settle agreements with the remainder of our customers under existing long-term supply agreements both in China and other countries," BHP Billiton marketing president Tom Schutte said in a statement.

Shares in BHP Billiton, which is pursuing a $US158 billion ($A164.67 billion) all-scrip takeover of Rio Tinto, gained 88 cents, or 2.21 per cent to close at $40.70.

Rio Tinto put on $3.75 cents to $125.70.

http://news.smh.com.au/business