Price deals bode well
THE early timing of price rise announcements by iron ore producers and steelmakers bodes well for the metal in 2007.
China’s biggest steelmaker Baosteel has agreed a price rise of 9.5 per cent with Australian mining giants Rio Tinto Ltd and BHP Billiton Ltd, as well as the world’s biggest producer of iron ore, Brazil’s CVRD.
The price hike was at the upper end of the market-forecast range of 5 to 10 per cent.
‘‘At the end of the day we were expecting somewhere around 8 to 10 per cent anyway — the market was fairly close, so it was really no surprise,’’ Shaw Stockbroking analyst John Colnan said.
‘‘So the only surprise was the speed with which they were settled, which probably still indicates a very strong and robust market.’’ Mr Colnan also said he was pleased the price-rise applied to both lump and fine iron ores.