In a further indication of a shift to quarterly raw materials contracts, more Japanese steelmakers have struck deals with coal miners for the April to June quarter.
JFE Holdings, Kobe Steel and Sumitomo Metal Industries have both agreed a price of $200 a tonne, up 55 percent from the deal for the previous financial year, the firms said on Wednesday. JFE and Kobe have signed deals with miners BHP, Rio and Teck Resources, while Sumitomo have agreed a deal with BHP.
While the steelmakers are all looking for a return to an annual contract from 1 July, the miners have the upper hand as they try to move to a system that reflects changes in the market, but which leaves the steelmakers exposed to greater volatility in cost and renders them exposed to the spot market.
Showing posts with label JFE. Show all posts
Showing posts with label JFE. Show all posts
Wednesday, March 17, 2010
Thursday, March 11, 2010
Vale "Walks Out Of Iron Ore Talks"
China’s National Business Daily is quoting a steel producer in China’s Hebei province as saying that Brazilian miner, Vale, the world’s largest iron ore miner, has quit the annual iron ore benchmark talks currently taking place between the large iron ore miners and China’s leading steel companies.
Vale have refused to comment.
As previously reported, Vale want to move away from an annual contract price to the spot price. However, spot prices are 80 per cent higher than last years’ contract price, and China’s steel mills have suggested that they will find a contract price rise of 40 to 50 per cent unpalatable amid suggestions that their profit margins have already been eroded. The price difference between the two parties may well explain Vale’s refusal to negotiate
Meanwhile, reports from Japan suggest that leading Japanese steelmaker, JFE Steel, are ready to accept a 90 per cent rise in their iron ore contract price. Vale have offered the new price for the April to June quarter and the Nikkei Daily reports that JFE are ready to accept. The company recently accepted a 55 per cent increase in the price it pays coal miner BHP Billiton for its coking coal.
Vale have refused to comment.
As previously reported, Vale want to move away from an annual contract price to the spot price. However, spot prices are 80 per cent higher than last years’ contract price, and China’s steel mills have suggested that they will find a contract price rise of 40 to 50 per cent unpalatable amid suggestions that their profit margins have already been eroded. The price difference between the two parties may well explain Vale’s refusal to negotiate
Meanwhile, reports from Japan suggest that leading Japanese steelmaker, JFE Steel, are ready to accept a 90 per cent rise in their iron ore contract price. Vale have offered the new price for the April to June quarter and the Nikkei Daily reports that JFE are ready to accept. The company recently accepted a 55 per cent increase in the price it pays coal miner BHP Billiton for its coking coal.
Monday, March 8, 2010
BHP Moves Coking Coal Prices To Shorter Contracts
BHP Billiton, the world’s largest miner, said on Monday that it had moved a “significant portion” of its coking coal sales for 2010 to “shorter term market based pricing”. This follows an agreement last week with Japanese steelmaker, JFE, in which it agreed an April to June contract price increase of 55 per cent.
Traditionally, coking coal prices have been agreed annually and there has been some resistance on the part of steel makers to agree to shorter-term contracts.
“These settlements reflect the company’s commitment to achieving market clearing prices over time across all its bulk commodities,” the company said in a statement. It said it had reached agreements with customers in Japan, China, India and Europe.
Indian analysts said they had been expecting a price of $180 a tonne for coking coal instead of the $200 a tonne they now face being charged. Pawan Burde of PINC Research said “Steelmakers will have to increases prices by $60-70 per tonne,” though with demand for Indian steel still strong he doesn’t see this as a problem.
Traditionally, coking coal prices have been agreed annually and there has been some resistance on the part of steel makers to agree to shorter-term contracts.
“These settlements reflect the company’s commitment to achieving market clearing prices over time across all its bulk commodities,” the company said in a statement. It said it had reached agreements with customers in Japan, China, India and Europe.
Indian analysts said they had been expecting a price of $180 a tonne for coking coal instead of the $200 a tonne they now face being charged. Pawan Burde of PINC Research said “Steelmakers will have to increases prices by $60-70 per tonne,” though with demand for Indian steel still strong he doesn’t see this as a problem.
Friday, March 5, 2010
JFE Agrees 55 Per Cent Coking Coal Price Rise
Japanese steelmaker JFE Holdings Inc, the world's sixth-biggest manufacturer of steel, has agreed to pay $200 a tonne to BHP Billiton for its coking coal in the April-June quarter. The new price represents a 55 per cent increase over the 2009/10 benchmark price.
A spokesman for the company suggested that despite agreeing a deal covering just one three-month period, it doesn’t mean the firm has accepted a quarterly pricing system.
See also
A spokesman for the company suggested that despite agreeing a deal covering just one three-month period, it doesn’t mean the firm has accepted a quarterly pricing system.
See also
Friday, December 18, 2009
JFE Steel To Buy Stake In Queensland Coal Mine
JFE Steel said on Thursday it would spend more than $US550 million ($A610.64 million) to buy a stake in an Australian coal mine as Japan vies with fast-growing emerging nations for a steady supply of raw materials.
JFE Steel Corp announced it would acquire a 20 per cent interest in the Byerwen Coal project from QCoal Pty Ltd. The mine, in Queensland, is expected to start production in 2012.
The two companies also agreed to a long-term supply deal for JFE Steel to receive coal from the project.
JFE, Japan's second-largest steel maker, said its total investment would be Y50 billion ($A617.97 million), including spending related to the mine's facilities.
The group said it aimed to get the project operating "as soon as possible in order to secure its own stable supply of good-quality coking coal over the long term and help stabilise the world's coking coal market".
Japan's steel makers have been seeking stable sources of raw materials by buying stakes in mines as the country jostles with other regional economies such as China and India for commodity supplies.
Anglo-Australian mining giant Rio Tinto said Thursday it had secured its first-ever iron ore sale to India, calling it a "ground-breaking" development.
Source: Sydney Morning Herald
JFE Steel Corp announced it would acquire a 20 per cent interest in the Byerwen Coal project from QCoal Pty Ltd. The mine, in Queensland, is expected to start production in 2012.
The two companies also agreed to a long-term supply deal for JFE Steel to receive coal from the project.
JFE, Japan's second-largest steel maker, said its total investment would be Y50 billion ($A617.97 million), including spending related to the mine's facilities.
The group said it aimed to get the project operating "as soon as possible in order to secure its own stable supply of good-quality coking coal over the long term and help stabilise the world's coking coal market".
Japan's steel makers have been seeking stable sources of raw materials by buying stakes in mines as the country jostles with other regional economies such as China and India for commodity supplies.
Anglo-Australian mining giant Rio Tinto said Thursday it had secured its first-ever iron ore sale to India, calling it a "ground-breaking" development.
Source: Sydney Morning Herald
Tuesday, January 13, 2009
Japan Steel Mills Begin Iron Ore Price Talks
Japanese steel mills, led by world No.2 Nippon Steel Corp, and three big miners including Brazil's Vale will open preliminary talks on 2009 term prices for iron ore this week, according to sources.
Japanese mills will send officials to miners for preliminary talks this week while Vale, Australia's BHP Billiton and Rio Tinto are all due to visit Tokyo next week for separate pricing negotiations.
The price talks on term supply for the business year from next April usually start in November in Japan, but have been substantially delayed as the steel market has tumbled amid the global economic downturn, making demand estimates difficult for both mills and miners.
Japanese steelmakers are expected to call for what would be the first cut in annual prices in seven years amid faltering demand and cutbacks in output, as well as expected strong pressure from Toyota and other carmakers for prices to be slashed on automotive sheet steel, their mainstay product.
JFE Steel Corp president Hajime Bada said last week he wanted iron ore prices for the year beginning in April to be cut at least to 2007/08 levels -- meaning Brazilian miners must cut by at least 39 percent and their Australian counterparts by around 45 percent.
China's steel firms, which began informal price talks late last year, last week joined JFE in demanding price cuts of around 40 percent.
Some analysts expect the annual price talks to reach agreement early as a recent recovery in iron ore prices could push mills to make an early settlement.
Spot iron ore prices plunged 70 percent from highs of nearly $200 per tonne last February to $60 a tonne in October, but have since recovered to about $80 a tonne.
Expectations for a steel recovery have gathered momentum in recent weeks as global output cuts tightened market conditions and forced buyers with low inventories to accept price hikes by some producers.
In 2008 price talks, Vale negotiated its price first and secured a 65 percent increase from Japanese mills. But Australian producers who settled later managed a nearly 80 percent increase.
Japanese mills will send officials to miners for preliminary talks this week while Vale, Australia's BHP Billiton and Rio Tinto are all due to visit Tokyo next week for separate pricing negotiations.
The price talks on term supply for the business year from next April usually start in November in Japan, but have been substantially delayed as the steel market has tumbled amid the global economic downturn, making demand estimates difficult for both mills and miners.
Japanese steelmakers are expected to call for what would be the first cut in annual prices in seven years amid faltering demand and cutbacks in output, as well as expected strong pressure from Toyota and other carmakers for prices to be slashed on automotive sheet steel, their mainstay product.
JFE Steel Corp president Hajime Bada said last week he wanted iron ore prices for the year beginning in April to be cut at least to 2007/08 levels -- meaning Brazilian miners must cut by at least 39 percent and their Australian counterparts by around 45 percent.
China's steel firms, which began informal price talks late last year, last week joined JFE in demanding price cuts of around 40 percent.
Some analysts expect the annual price talks to reach agreement early as a recent recovery in iron ore prices could push mills to make an early settlement.
Spot iron ore prices plunged 70 percent from highs of nearly $200 per tonne last February to $60 a tonne in October, but have since recovered to about $80 a tonne.
Expectations for a steel recovery have gathered momentum in recent weeks as global output cuts tightened market conditions and forced buyers with low inventories to accept price hikes by some producers.
In 2008 price talks, Vale negotiated its price first and secured a 65 percent increase from Japanese mills. But Australian producers who settled later managed a nearly 80 percent increase.
Thursday, January 8, 2009
JFE Looks For Iron Ore Prices To Fall To 2007 Levels
Mr Hajime Bada, the president of the world's third-largest steelmaker, JFE Steel, Hajime Bada, says the Japanese company wants prices of iron ore and coking coal in the fiscal year of 2009 to fall to at least fiscal 2007 levels due to the precipitous world decline in steel demand. According to reporters at a reception for the Japan Iron and Steel Federation “the fiscal 2007 levels, that's the minimum for us.”
Iron-ore prices have nearly tripled this business year, ending March 31, amid tight supply, but demand for steel has fallen sharply since late last year due to the downturn in the global economy. In a new report, the Fitch Ratings credit-rating agency says that “contract prices for iron ore and metallurgical coal are expected to be 20%−40% lower than the $77/metric ton contract price settled by Companhia Vale do Rio Doce (Vale of Brazil) or the $94/metric tons contract price settled by Rio Tinto (of Australia) last year.”
Major steelmakers in China and Japan (the users of 53% of seaborne iron ore and coking coal) and their suppliers typically set the fiscal-year prices that are charged to smaller steel firms throughout Asia and India. These prices aren’t the same but do set the trends for North American and European import prices of iron ore and metallurgical coal.
Source: Purchasing.com
Iron-ore prices have nearly tripled this business year, ending March 31, amid tight supply, but demand for steel has fallen sharply since late last year due to the downturn in the global economy. In a new report, the Fitch Ratings credit-rating agency says that “contract prices for iron ore and metallurgical coal are expected to be 20%−40% lower than the $77/metric ton contract price settled by Companhia Vale do Rio Doce (Vale of Brazil) or the $94/metric tons contract price settled by Rio Tinto (of Australia) last year.”
Major steelmakers in China and Japan (the users of 53% of seaborne iron ore and coking coal) and their suppliers typically set the fiscal-year prices that are charged to smaller steel firms throughout Asia and India. These prices aren’t the same but do set the trends for North American and European import prices of iron ore and metallurgical coal.
Source: Purchasing.com
Thursday, July 17, 2008
Rizhao Iron Ore Volume Tops 29Million Tonnes In H1
China Customs statistics shows that Chinese iron ore imports through Rizhao port reached 29.27 million tonne for January to June period, making it the number one port for iron ore imports in terms of volume.
The newly-built 250,000 tonne dock has provided more room for piling up iron ore. At the same time, it has strived to enlarge market share and tonnages have jumped by 19.3% year on year in the first half of 2008.
Rizhao port is now concentrating on the construction of key projects, including the second phase of the iron ore yard, which is expected to be put into force in H2. The new projects are expected to further sharpen its edge over its competitors.
Rizhao's throughput topped 100 million tonnes in 2006 and surged by 19% to 130 million tonne in 2007. It ranks number among sea ports in China.
Source: Steel Guru
The newly-built 250,000 tonne dock has provided more room for piling up iron ore. At the same time, it has strived to enlarge market share and tonnages have jumped by 19.3% year on year in the first half of 2008.
Rizhao port is now concentrating on the construction of key projects, including the second phase of the iron ore yard, which is expected to be put into force in H2. The new projects are expected to further sharpen its edge over its competitors.
Rizhao's throughput topped 100 million tonnes in 2006 and surged by 19% to 130 million tonne in 2007. It ranks number among sea ports in China.
Source: Steel Guru
Tuesday, July 8, 2008
BHP Agrees Iron Ore Prices With Japanese Steelmakers
Nippon Steel Corp., the world's second-biggest steelmaker has accepted a record increase in iron ore prices from BHP Billiton Ltd., matching a doubling of prices agreed last month with Rio Tinto Group.
The steelmaker, which in April said higher costs would pare annual profit 41 percent, will pay BHP as much as 97 percent more for ore, Masato Suzuki, a spokesman for the Tokyo-based company said today by phone. JFE Holdings Inc., Japan's second-biggest mill, also accepted the BHP increase, said an official for the company's steelmaking unit, who asked not to be identified.
The BHP contracts, the last to be settled among Asian steelmakers and the world's three biggest suppliers of iron ore, marked the first year in which miners in Australia gained bigger price increases than rivals in Brazil. Nippon Steel and its largest Asian rivals in February agreed to increases of as much as 71 percent from Cia. Vale do Rio Doce, the world's biggest iron-ore producer.
Iron ore prices have gained almost fourfold since 2001 to a record, increasing costs for Japanese steelmakers, which rely exclusively on imported materials. It's the first time the year's initial agreement on ore price wasn't accepted as the benchmark.
Baosteel Group Corp., China's biggest mill, last week accepted an increase of as much as 97 percent for ore from BHP, the world's biggest mining company. This matched an increase won last month from Asian steelmakers by Rio Tinto Group, the world's second-biggest iron-ore supplier.
``We can confirm we have settled with all our Japanese customers,'' Emma Meade, a spokeswoman for Melbourne-based BHP said today. She confirmed the contract price agreements were for the same price as last week's with Baosteel.
Source: Bloomberg
The steelmaker, which in April said higher costs would pare annual profit 41 percent, will pay BHP as much as 97 percent more for ore, Masato Suzuki, a spokesman for the Tokyo-based company said today by phone. JFE Holdings Inc., Japan's second-biggest mill, also accepted the BHP increase, said an official for the company's steelmaking unit, who asked not to be identified.
The BHP contracts, the last to be settled among Asian steelmakers and the world's three biggest suppliers of iron ore, marked the first year in which miners in Australia gained bigger price increases than rivals in Brazil. Nippon Steel and its largest Asian rivals in February agreed to increases of as much as 71 percent from Cia. Vale do Rio Doce, the world's biggest iron-ore producer.
Iron ore prices have gained almost fourfold since 2001 to a record, increasing costs for Japanese steelmakers, which rely exclusively on imported materials. It's the first time the year's initial agreement on ore price wasn't accepted as the benchmark.
Baosteel Group Corp., China's biggest mill, last week accepted an increase of as much as 97 percent for ore from BHP, the world's biggest mining company. This matched an increase won last month from Asian steelmakers by Rio Tinto Group, the world's second-biggest iron-ore supplier.
``We can confirm we have settled with all our Japanese customers,'' Emma Meade, a spokeswoman for Melbourne-based BHP said today. She confirmed the contract price agreements were for the same price as last week's with Baosteel.
Source: Bloomberg
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