This marks a major change from Vale's previous pricing system which based contract prices on the average spot market price of iron ore during the three months, or quarter, before the month preceding the quarter in which the iron ore would be delivered, resulting in a major diversion between contract and spot market prices.
Vale changes iron ore pricing method
Brazil-based iron ore mining company Vale announced Wednesday that it has changed its iron ore pricing method for about 80 percent of its customers. New contract iron ore prices will be based on the average price during the quarter in which the iron ore is delivered. Spot iron ore prices plummeted 31 percent during October, leading many Vale customers, particularly in China, to insist on a pricing method that better reflects changes in the spot market.
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Iron Ore Raw Mat China Brazil Far East South America East Asia and Pacific Trading Steelmaking Mining Vale
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