SteelOrbis Shanghai
China's Hubei Province-based Wuhan Iron and Steel Corporation (
WISCO) has signed a long-term agreement for
iron ore supply with Australian Fortescue Metals Group Ltd. (FMG) through the intermediary of
WISCO International Trade. According to the agreement,
WISCO is to receive 4.4 percent of initial
iron ore output from FMG Company every year - about two million metric tons of
iron ore per annum. FMG Company's
iron ore output currently stands at around 45 million metric tons of
iron ore per annum.
The agreement includes an additional sales clause which specifies that when FMG Company's annual
iron ore output far exceeds 45 million metric tons,
WISCO may obtain an annual five million metric tons of
iron ore from FMG Company.
The price of
iron ore in the agreement, which will run for 10 years, will be made according to the annual international basic
iron ore price.