Vale now selling 80 percent of its iron ore on spot market

Brazil-based iron ore producer Vale announced on Thursday that it is selling 80 percent of its iron ore using spot pricing. The new system for Vale was prompted by Chinese steelmakers--Vale's largest cliental--in order to benefit from falling iron ore prices. The shift in pricing will replace contracts that were adjusted quarterly using an average of past spot prices. According to a conference call with company executive's, the remaining 20 percent of the contracts are largely with Japanese and Korean steel companies and they are expected to migrate to spot pricing.