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Miners likely to seek parity with spot: benchmark prices could rise by 80%

March 08, 2010 - 00:00 GMT

Hike - Analysts predict levels previously thought untenable as debate hots up

The outlook for 2010 iron ore benchmark prices has moved to levels thought untenable until a few weeks ago as negotiations continued and debate heats up. One analyst has predicted this year’s settlement will be 80% higher than last year’s level. A senior ArcelorMittal executive was reported last week as confirming this view. “What we’re hearing from Asia is in the direction of 70-80%,” Robrecht Himpe, ceo of ArcelorMittal’s Flat Carbon Europe business, told The Australian. Underpinning the revised predictions has been the run-up in spot iron ore prices to as high as $140 per tonne cfr China — a level that is close to double last year’s default annual contract prices. Earlier last week Chinese media suggested that BHP Billiton, Rio Tinto, and Vale had tabled a 50% demand in benchmark talks,...

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