Japan Major Steels Fail to Settle Australian Iron Ore Price

Japanese major integrated steel makers including Nippon Steel negotiated with BHP Billiton for iron ore price for fiscal 2008 shipment. They failed to reach agreement without progress at the third negotiation. BHP Billiton apparently waits the move by Rio Tinto, which tries to seek freight premium. Japanese makers’ iron ore price settlement with Australian suppliers could continues through the end of fiscal 2007. Japanese steel makers continue negotiation with Rio Tinto while they didn’t talk after the negotiation in February. Rio Tinto announced the firm keeps seeking freight premium to reflect freight differentiation between Brazil to Far East and Australia to Far East even after settlement with Vale. Japanese steel makers and POSCO finalized the negotiation with Vale to increase the price by 65% from fiscal 2007. Vale already agreed with ThyssenKrupp and Arcelor Mittal and the so-called benchmark price is widely accepted.