Australian mining giant Rio Tinto said today that the iron ore price concluded by Australian third largest iron ore miner Fortescue and China has nothing with the price talks between China and Rio Tinto.
According to Rio Tinto, it does not see the pricing agreement by Fortescue and Chinese steelmakers as relevant to its pricing for the Japanese fiscal year 2009, while the miner conducts its own negotiations with customers worldwide.
Earlier today, Fortescue announced that it settled the iron ore sales price, which was lower three percent than Rio Tinto expected. Fortescue issued that it has reached an agreement with Chinese steel mills on iron ore prices that represents a 35 percent discount, compared with the other Australian miners benchmark set last year, while it is also about three percent below the price for the same grade that Australian miners Rio Tinto Ltd and BHP Billiton Ltd. previously agreed with other major Asian steelmakers.
Despite Fortescue CEO Andrew Forrest said that the iron ore price agreed with China was fair and equitable, market analysts believes that the settled price is unlikely to become a benchmark as Fortescue is relatively smaller supplier and its iron ore is accepted as a slightly inferior quality.