The Nikkei Business Daily is quoting the CEO of BHP Billiton as saying that the miner wants to shift to a quarterly pricing system rather than the current system of setting an annual benchmark price.
Marius Kloppers told Nikkei that wild fluctuations in demand and exchange rates have rendered outdated the annual benchmark system. However Mr Kloppers is expected to encounter some resistance to his proposal from Japanese steelmakers, who believe that the current system provides some stability from frequently fluctuating costs.
But Kloppers was quoted by the Nikkei as saying that it is not acceptable to continue using the existing system just for iron ore and coking coal now that the mechanism for fuel coal has been shifted to a market price-based system.
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