The iron ore industry is very large, consolidated and conservative in its pricing and commercial agreements. Global consumption of iron ore is over 2bn tpy, and seaborne internationally-traded iron ore amounted to around 900m tonnes last year, making it the largest dry bulk commodity by some margin. Iron ore has traditionally been priced on annual contracts, against a benchmark settled between a leading supplier and a regional steel mill – a system that Metal Bulletin helped to broker in the 1970s – and there has been no tradable terminal market, unlike most other significant commodities. As the world’s largest steel producer, China has a big influence over iron ore demand, despite its steel output having been hit since June 2008: first by completion of construction work for the Olympics, and then by the financial crisis and global economic recession. China’s raw steel output was still up last year, at 500m...