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re: iron ore prices SYDNEY (Dow Jones)--Brazil's Companhia Vale do Rio Doce (RIO), or CVRD, said late Monday it has settled a 19% iron ore contract price increase with Germany's largest steel maker Thyssen Krupp Stahl AG (TKA.XE).

The world's largest iron ore producer said prices for its Carajás and Southern System fines rose by 19% on last year's contract, while blast furnace pellets fell 3%.



CRVD, along with the world's second and third largest iron ore producers Rio Tinto PLC (RTP) and BHP Billiton (BHP), continue to negotiate contract prices with Chinese steel mills for the Japanese fiscal year started April 1.

The miners have said they are in no hurry to reach a settlement with steel producers given market conditions continue to improve.

When talks began, China indicated it was seeking a cut in prices after a 71.5% rise the year before, but statements from Chinese steel mills indicate they are now fighting to keep the rise this year to less than 10%.

Chinese demand for iron ore remains strong and steel prices have risen substantially since late last year when contract price talks began, Rio Tinto Chairman Paul Skinner told reporters earlier this month.

Analysts are expecting price rises of between 10% and 20% and CVRD has said it wants a 24% gain.

European iron ore prices typically settle at a premium to Asian prices, meaning the 19% settlement likely translates to around 15-16% in Asia, said Goldman Sachs JBWere head of institutional sales Patrick Crabb.

He said the deal may be mildly disappointing for markets anticipating an around 20% hike to result from the current talks with Chinese mills.