Kumba Iron Ore, South Africa's largest iron ore producer and a subsidiary of Anglo American Plc, announced on May 19 that it will extend its interim iron ore supply agreement with the local unit of the world's top steelmaker, ArcelorMittal South Africa, until July next year in order to conclude arbitration between the two companies. The two companies have been at loggerheads over iron ore prices since February last year.
Kumba stated, "The companies have now agreed to an addendum to the current interim supply agreement which extends the terms and conditions of the current interim agreement to allow sufficient time for the arbitration process to be finalised."
Under the terms of the deal, ArcelorMittal will continue to pay a fixed price of US$50/mt for ore for its Saldanha plant and US$70/mt for its inland plants for one year until July 2012.