The Brazilian iron ore mining giant Vale has indicated that at the end of each quarter, the new iron ore price for the upcoming quarter is to be decided by the average monthly iron ore price of the three months before the last month of the old quarter. This means the price for Q1 2011 will be based on the average spot market price of September, October and November 2010.
On November 8, Vale, the largest iron ore supplier in the world, stated, "Vale has made agreement with all customers to use the quarterly pricing system, and the Chinese spot market price index is the benchmark."
The China Iron and Steel Association had previously made an unilateral announcement of a return to iron ore negotiations on yearly contracts, but has been unable to gather support. Yearly contract negotiations have traditionally started in November, but the CISA's announcement of new negotiations met with no response from the miners.