China has turned to Brazil’s Vale SA to get a better price on iron ore contracts, Bloomberg reported, citing an unsourced report in the Australian Financial Review. The China Iron and Steel Association (CISA) is currently in negotiations with Vale after China refused to accept Anglo-Australian miner Rio Tinto’s offer of a 33% price reduction, which was accepted by Japan and South Korea. In the absence of a contract, China must buy iron ore on the market at spot prices. China wants Vale to offer a better deal in exchange for shifting its purchasing toward Vale and away from Rio. Vale, the world’s largest iron ore supplier, previously stated it will wait for Australian producers to set prices with China before striking its own agreements.
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