The Swiss-headquartered resources company Ferrexpo has announced that its Ukraine-based iron ore production subsidiary Ferrexpo Poltava GOK Corporation, in which it holds approximately 97.3 percent of the share capital, has agreed to buy from the Stakhanov Wagon Works 400 newly-built open rail car wagons of 12-9046 model with an option to purchase an additional 600 units.
The wagons are to be used for the transportation of Poltava GOK's iron ore pellets to the Ukrainian border for delivery to its customers. It is proposed that the wagons shall be delivered in consignments of 50 units per month, the first of which will be delivered in March this year.
Ferrexpo stated that the price of an open wagon shall be $65,000, although this price shall, by agreement between the parties, be subject to adjustment for each monthly consignment to reflect the current market price of open wagons in the CIS.
"As part of its growth and marketing strategy, Ferrexpo is committed to the development of its logistic capabilities by investing in its own fleet of railway cars," said the company in its statement, adding that such investment is required to support medium-term production growth which is expected to increase by a third to 12 million mt of pellets per annum by 2013.