Rio, BHP may cut quarterly Iron ore prices by 11% as demand falls in China

August 27,

As per the researchers, Rio Tinto group and BHP Billiton ltd. may ask Chinese steelmakers to pay 11% less for fourth- quarter Iron ore prices.

Prices may drop to $129/MT in the quarter starting Oct. 1, down from $145.30 in the third quarter, Hu Kai, an analyst at UC361.com, said today.

Rio, BHP and Brazil’s Vale, which account for 3/4^th of global Iron ore trade, this year set up a pricing based on quarterly agreements as they bet on rising prices. Spot prices fell in April due to poor steel demand.

Contract prices for 65 percent Iron ore from Vale, the world’s biggest Iron ore exporter, may fall 8 % to $133 a ton in the fourth quarter from the prior three months.

Source: Bloomberg