China is reported to have reached agreement with the international iron ore suppliers for a 32.95 percent cut in the fine ore price and a 44.46 percent drop in the lump ore price.
According to the agreement, the price agreed for the 2009 contract year for Pilbara Blend Fines and Yandicoogina Fines is US cents 97 per dry metric ton unit, while the price for Pilbara Blend Lump is US cent 112 per dry metric ton unit. The contract will be effective from April 1 to October 31, 2009. Negotiations for the second half of the 2009 fiscal year are still in progress.
The China Iron and Steel Association and Baosteel have not yet officially confirmed this information.
As SteelOrbis previously reported, on May 28 Australian miner Rio Tinto settled its iron ore contract prices for 2009 with Asian steelmakers, excepting China, at US cents 97 per dry metric ton unit, down by 32.95 percent, for Pilbara Blend Fines and Yandicoogina Fines, and at US cents 112 per dry metric ton unit, down by 44.46 percent, for Pilbara Blend Lump.
In addition, on June 10 Brazilian miner Vale decreased its iron ore prices for fines by 28.2 percent and for lumps by 44.47 percent as compared to the 2008 benchmark prices for Asian steelmakers. Vale's new reference prices per dry metric ton unit for 2009 are US cents 85.43 for Southeastern System fines (SSF), US cents 89.87 for Carajás sinter feed (SFCJ), US cents 99.42 for Southeastern System lump and US$1.0094 for Southern System lump.