Indian iron ore prices soar on Chinese boycott call of big miners

Spot prices of Indian iron ore soared to $183.1 per tonne yesterday after the Chinese steel trade body called for boycott of the big three global miners, Vale, Rio Tinto and BHP Billiton, for discontinuing the old annual iron ore benchmark system and sought a whopping 90-per cent rate hike for this quarter.

Spot prices of Indian iron ore fines of 63.5 per cent Fe soared to $181.7-$183.1 per tonne yesterday from $171 a tonne at the beginning of April, a jump of $10 per tonne after the China Iron and Steel Association (CISA) called for a boycott of iron ore produced by the big three global miners last week.

Shan Shanghua, director of the CISA, had asked steel makers and iron ore traders not to buy iron ore from the big three miners for the next two months on the ground that the miners' monopoly had made it impossible for China to negotiate the annual ore contract price.

The boycott call came after the world's largest and the third-largest iron ore miners Vale of Brazil and Anglo Australian miner BHP Billiton, got the Japanese steel mills to agree to a quarterly pricing system, with Vale managing to get a 90-per cent rate hike for this quarter. (See: BHP, Vale wrangle quarterly iron ore deal with Japan, Vale gets 90-per cent hike) 

Melbourne-based BHP Billiton secured a 99.7 per cent price hike from Asian steelmakers, which is 9.7 per cent more than Vale secured from Japanese steel mills. (See: BHP Billiton almost doubles iron ore price for Asian steelmakers) 

BHP Billiton fixed ore prices at $120.08 a tonne for the three months starting 1 April compared with $60-a-tonne price settled through the annual contract system for 2009-10.
According to Chinese media, 19 Chinese major ports have a stockpile of 67.37 million tonnes of iron ore this week, 155,000 tonnes less from a week ago.