Nippon Denko Co., Japan’s largest ferroalloy maker, and Nippon Steel Corp. may reach an agreement to pay BHP Billiton Ltd. about 66 percent less for manganese ore as demand weakens.
Nippon Denko and Nippon Steel, Japan’s top steel mill and a 9.4 percent stakeholder in the ferroalloy company, will likely pay BHP about $5.50 per 1 percent manganese contained in a metric ton of ore in the year started April, Hisaki Watanabe, a Nippon Denko’s investor relations official, said today by phone. That’s compared with about $16 a ton for October to December.
Japan imported 1.1 million tons of manganese ore in 2008, according to the Ministry of Finance. Australian ore accounted for 36 percent of the supplies and South Africa provided 61 percent. Contract prices had quadrupled last April from a year earlier.
Kelly Quirke, a spokeswoman at BHP in Melbourne, declined to comment on the ongoing price talks. A spokesman for Tokyo-based Nippon Steel was not immediately available for comment.
Source: Bloomberg; Tekko
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