On September 13, Chinese steelmaker General Steel Holdings, Inc. announced that it has formed a new joint venture with Chinese commodity trader Tianjin Materials and Equipment Group Corporation (TME Group).
According to a General Steel release, the company’s capital contribution to Tianwu General Steel Material Trading Co, Ltd (Tianwu JV), the new company, is approximately $2.9 million, based on which General Steel will hold a 60 percent controlling interest.
Tianwu JV will source raw materials, including domestic and overseas iron ore, and is expected to supply approximately 37.5-50 percent of General Steel's iron ore needs, amounting to approximately two to three million metric tons on an annual basis.
On September 3, Tianwu JV entered into an iron ore supply contract with Minera Santa Fe, a Chilean iron ore supplier. Pursuant to the contract, Tianwu JV will receive favorable pricing on the purchase of 138,000 mt of iron ore for the remainder of 2010.