Brazil Samarco Signs Pellet Deals With Lion Group, Nu-Iron
17 June 2009 - 5:29AM
Dow Jones News
Brazil's Samarco Mineracao SA has settled 2009 iron ore pellet
deals with two more steel mills following its setting a reference
price with Indonesia's Krakatau Steel on Monday, Samarco said
Tuesday.
The two steelmakers are Malaysia's Lion Group and Nu-Iron of
Trinidad and Tobago.
Both accepted the new price at $1.2523 per dry metric ton unit,
or approximately $84 per metric ton, for Samarco's direct reduction
iron ore pellets. This is 48.3% lower than the 2008 price, Samarco
said
Samarco has an annual 2 million metric ton supply contract with
Lion Group and a 1 million ton contract with Nu-Iron.
Samarco is jointly owned by Brazilian mining giant Vale SA
(VALE) and its global competitor, Australia's BHP Billiton Ltd.
(BHP).
Samarco said Monday it would supply 900,000 tons of the pellets
to Krakatau.
In late May, Samarco said it would continue operating its iron
ore pellet plant below capacity for at least another four
months.
Two of Samarco's three units, each with 7 million metric tons a
year capacity, were mothballed at the end of November owing to
falling demand.
Samarco's production capacity is 21.6 million tons a year, but
the company expects to produce only 14 million tons in 2009.
All Samarco's output is exported.
-By John Kolodziejski, Dow Jones Newswires; 55-21-2586-6086;
John.Kolodziejski@dowjones.com
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