BHP Billiton won't accept the iron ore prices reached between Chinese steel mills and Fortescue, Local media reported on Tuesday, citing senior officials of BHP China.
A Chinese senior of BHP, the world's third-largest iron-ore exporter, told China Securities Journal that BHP won't follow the iron ore prices of Fortescue, though the company hasn't made public statement.
China made its first official iron ore term deal with upstart Australian miner Fortescue on Monday in exchange for up to $6 billion in funding, hoping the deal would set the benchmark reference price in fraught and prolonged annual negotiations with major miners which turned to diplomatic uproar after the spying charges.
The iron ore prices agreed with Fortescue should be acknowledged and Chinese steel industry will insist upon its stance of a unified price of imported iron ore, China Securities Journal said, citing a senior official from the China Iron and Steel Association (CISA).
It needs further negotiations with the other three global miners to see whether they'll accept the 35% price cut for 2009-10 term ore prices, the CISA official said.
A spokesman of Rio Tinto, the world's second largest iron ore provider, said previously that the pricing of FMG with China has nothing to do with them.
Vale, the world's largest iron ore producer, hasn't made any statement on the negotiations so far.
The CISA official didn't comment on whether there would be any penalties imposed on the three global miners if they failed to seal a deal with the Chinese mills, the report said.