On July 17, Brazilian mining giant Vale S.A. (Vale) announced that it concluded the iron ore and pellet price negotiations for 2009 with Turkey's largest steelmaker Eregli Demir Celik (Erdemir) and Italian steelmaker Ilva S.p.A. (Ilva).
As the outcome of these negotiations, Vale agreed on the iron ore prices for fines and lumps with Erdemir, while it agreed just on the iron ore prices for fines with Ilva. Relative to the 2008 benchmark prices, the iron ore prices for fines decreased by 28.2 percent for both steelmakers, while the prices for lumps declined by 44.47 percent for Erdemir.
Therefore, the new reference prices per dry metric ton Fe unit for 2009 are US$0.9651 for Southern and Southeastern Systems fines (SSF), US$1.0095 for Carajás Sinter Feed (SFCJ), and US$1.0962 for Southern System Lump.
In addition, the blast furnace pellet price decreased by 48.3 percent compared to 2008. The new reference price per dry metric ton Fe unit for Erdemir is US$1.1685 for Carajás blast furnace pellets, while the new reference price per dry metric ton Fe unit for Ilva is US$1.1384 for Tubarão blast furnace pellets.
In June, Vale concluded its iron ore and pellet price negotiations for 2009 with Japanese, South Korean and Taiwanese steelmakers, followed by a deal with steel giant ArcelorMittal. The percentage price decreases for the Asian steelmakers and ArcelorMittal are the same as given above for Erdemir and Ilva.