The China Iron and Steel Association is holding iron ore price talks with Brazil’s Vale SA instead of Rio Tinto Group after four of Rio’s executives were detained in China on allegations of espionage, the Australian Financial Review reported without saying where it got the information.
The association wants Vale to accept a lower benchmark price for contracted iron ore in exchange for buying more of the raw material from the Brazilian company, the newspaper reported, citing unidentified sources.
Vale spokesman Fernando Thompson said the company doesn’t comment on market speculation. Rio spokesman Gervase Greene wasn’t available when contacted today in Perth.
Steel mills in China, the world’s largest buyer of iron ore, are seeking a bigger price cut than the 33 percent agreed on in May between London-based Rio and Japanese, South Korean and Taiwan producers. Vale, the world’s biggest, has said it’s waiting for Australian producers to set prices with China before concluding its own agreements with Chinese mills.
The price talks are ongoing and may conclude soon, Zou Jian, former chairman of the China Metallurgical Mining Enterprise Association, a body of domestic iron ore mining companies, said in Beijing on July 15. Zou cited information from the association for his comment.
Source: Bloomberg
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