Rio Ore Price May Rise More
Tinto Group, the world's third- largest mining
company, may secure a record increase of more
than 95 percent price for iron ore shipped to
Asian steel mills, according to Macquarie Group
Rio is committed to securing more than the 71
percent agreed by Brazil's Cia. Vale do Rio Doce
in February, and greater than ``the 85 percent
and 95 percent estimates that have figured prominently
in recent speculation,'' Macquarie analysts led
by Jim Lennon said in a report today.
in China, the largest iron-ore buyers, have failed
to arrest a tripling of prices in five years.
Rio is seeking to double output from its Western
Australian mines to 320 million metric tons within
five years to take advantage of these prices.
should be prepared for an extended and potentially
hostile conclusion to the negotiations,'' Lennon
wrote in the report. Talks may continue past the
end of June, he said.
fell by as much as A$2.33, or 1.7 percent, to
A$136.27, and was A$137.00 at 10:13 a.m. Sydney
time on the Australian stock exchange. It has
gained 2.3 percent this year outpacing the benchmark
index, which as declined 17.6 percent.
and rival BHP Billiton Ltd. want to charge a so-called
freight premium on iron-ore sales to Asian mills
because companies such as China's Baosteel Group
Corp. pay less to ship the material from the companies'
Australian mines than from Vale's operations in
spokeswoman Amanda Buckley was not available for
comment at her office.