Chinese snub BHP Billiton   
Helen Yuan

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Bloomberg 

SHANGHAI — China’s 16 biggest steel makers have rejected a request from BHP Billiton, the world’s largest mining company, that it be paid as much as $10 a ton more for iron ore in addition to a 71,5% increase secured by its rivals. 

The steel makers, which include Shanghai Baosteel Group, the country’s biggest, expected BHP Billiton not to “insist on the unreasonable request” with a view to “long-term interests”, the China Iron and Steel Association said on its website. 

BHP Billiton had asked for an additional charge of $7,50 to $10 a ton, the association said in a statement.

That would amount to an increase of 105%-110% over last year’s iron-ore price, said Lou Chunlian, an iron ore researcher at Baosteel. 

Chinese steel makers have already agreed to pay 71,5% more this year for ore from Rio Tinto Group and Brazil’s Companhia Vale do Rio Doce — both of which are competitors of BHP Billiton. 

The Australian Financial Review said yesterday that BHP Billiton was seeking the extra charge to bring the landed cost of its ore in China closer to that from Brazil.

China, the world’s largest steel producer and consumer, is the fastest-growing major economy and its expansion has fuelled demand for iron ore, coal and copper.