FMG adopts market-linked pricing, following 3 ore giants

16:17, April 22, 2010      

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Following Rio Tinto, BHP Billiton and Vale, Australia's third-largest iron ore exporter, Fortescue Metals Group (FMG), has also announced that it will adopt a market-linked pricing system. With FMG's announcement, all of the major iron ore suppliers that had previously signed long-term agreements with China have claimed that they support flexible pricing.

FMG made the announcement in its financial report for the first quarter of 2010 and said because the pricing agreement it signed with China expired on Jan. 1, 2010, China now has six to eight weeks to decide the future sales and transport scale. In addition, FMG said that the first quarter is a transition period and after that period, they will modify their pricing policy in line with the industry and adopt the market-linked system.

FMG has more than 50 clients in China, all of which are iron and steel enterprises. All of the 40 million tons of iron ore produced by FMG in 2009 were sold to China. As a result, FMG is China's fourth-largest foreign iron ore supplier.

By People's Daily Online


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