Energy News  
Pressure builds on China after Japan Australia iron ore price deal

A worker helps conduct a "pour" during a visit by Chinese Premier Wen Jiabao (not pictured) at Australian mining giant Rio Tinto's plant at Kwinana in Perth, 02 April 2006. Wen is the first Chinese premier to tour Australia since 1988 and the most senior official since President Hu Jintao visited in October 2003. Photo courtesy of Tony Ashby and AFP.
by Staff Writers
Sydney (AFP) May 18, 2006
Mining giant Rio Tinto announced Thursday that major Japanese steel mills had agreed to a 19 percent hike in iron ore prices putting pressure on resource hungry Chinese mills to do the same.

Rio Tinto said the Japanese had agreed to the 19 percent increase in prices for iron fines for the year beginning April 1, but that negotiations were still continuing over lump prices.

"This year's pricing reflects the current international market, which is characterised by extremely tight supply and a continuing high level of demand," Rio Tinto's iron ore group chief executive Sam Walsh said.

The price hike follows the announcement by the world's biggest iron ore producer, Brazil's CVRD, on Monday that it had won a 19 percent increase in the iron ore price from Germany's biggest steelmaker, Thyssen Krupp Stahl.

That rise was at the upper end of analysts' expectations of a 10-20 percent increase after a record 71.5 percent hike in iron ore prices last year.

The price pressure reflects the heavy demand for steel, notably to feed China's huge economic boom.

In the wake of the CVRD-Thyssen deal, analysts predicted that Asian steel producers would have to follow suit and swallow another 19 percent price hike.

But China has argued that it should not be held to the CVRD benchmark following last year's record price rise.

But ABN Amro mining analyst Rob Clifford said the agreement between Rio Tinto and the Japanese meant the Chinese would find it difficult to hold out in the negotiations, which should have concluded by April 1.

"My view is that they are running out of arguments at this point and the most likely outcome is that they will have to capitulate," he said.

Clifford said a benchmark price had now been set and other firms like Australian industry leader BHP Billiton would soon follow.

He called the 19 percent boost a "cracking result" for miners, the second biggest yearly increase ever won.

Community
Email This Article
Comment On This Article

Related Links
Powering The World in the 21st Century at Energy-Daily.com



Memory Foam Mattress Review
Newsletters :: SpaceDaily :: SpaceWar :: TerraDaily :: Energy Daily
XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News


China insists its market must be factored in iron ore pricing
Shanghai (AFP) May 18, 2006
China insisted Thursday that its domestic market conditions must be taken into consideration over stalled annual contract pricing negotiations for key steel-making commodity iron ore.







  • New Laser Technique That Strips Hydrogen From Silicon Surfaces
  • Australian PM seeks cooperation with Canada on climate change
  • Pressure builds on China after Japan Australia iron ore price deal
  • China insists its market must be factored in iron ore pricing

  • Russia offers to build Turkey's first nuclear plants
  • Russia planning to bid in Vietnam nuclear power plant tender
  • Czech power company CEZ selects Russian nuclear fuel supplier
  • Blair signals new generation of British nuclear power stations

  • In The Baltics Spring And Smoke Is In The Air
  • UNH And NASA Unlock The Puzzle Of Global Air Quality
  • Project Achieves Milestone In Analyzing Pollutants Dimming The Atmosphere
  • The 'Oxygen Imperative'

  • Himalayan Forests Disappearing
  • Global Pulp Mill Growth Threatens Forests, May Collapse
  • Experts Sound Alarm Over State Of Czech Forests
  • Diverse Tropical Forests Defy Metabolic Ecology Models

  • Who Really Buys Organic
  • Alternatives To The Use Of Nitrate As A Fertiliser
  • Researchers Trawl The Origins Of Sea Fishing In Northern Europe
  • Greens Happy As EU Tightens GMO Testing

  • Activists Press Ford On Environmental Policies
  • Prototype For Revolutionary One-Metre Wide Vehicle Is Developed
  • Highly Realistic Driving Simulator Helps Develop Safer Cars
  • Research On The Road To Intelligent Cars

  • British Aerospace Production Up Strongly In First Quarter
  • Face Of Outdoor Advertising Changes With New Airship Design
  • NASA Denies Talks With Japan On Supersonic Jet
  • Test Pilot Crossfield Killed In Private Plane Crash

  • Could NASA Get To Pluto Faster? Space Expert Says Yes - By Thinking Nuclear
  • NASA plans to send new robot to Jupiter
  • Los Alamos Hopes To Lead New Era Of Nuclear Space Tranportion With Jovian Mission
  • Boeing Selects Leader for Nuclear Space Systems Program

  • The content herein, unless otherwise known to be public domain, are Copyright 1995-2006 - SpaceDaily.AFP and UPI Wire Stories are copyright Agence France-Presse and United Press International. ESA PortalReports are copyright European Space Agency. All NASA sourced material is public domain. Additionalcopyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by SpaceDaily on any Web page published or hosted by SpaceDaily. Privacy Statement