Brazil's Vale joins rivals with China iron ore discounts - sources

jueves 26 de junio de 2014 04:17 GYT

* Vale joins Australian miners in offering contract discounts

* Competition among top miners to lure Chinese buyers heats up

* Growing supply may help China gain upper hand in pricing

By Ruby Lian and Fayen Wong

SHANGHAI, June 26 (Reuters) - Brazil's Vale, the world's biggest iron ore miner, is starting to offer discounts on shipments of the steelmaking raw material to top consumer China, joining Australian rivals in cutting prices following a global surge in production.

The move follows deeper price cuts by Rio Tinto and Australia's Fortescue Metals Group for lower-grade iron ore, and indicates China is winning more say over pricing after years of complaining that costs were too high.

Vale is offering some Chinese customers a discount of $2.50 a tonne, including cost and freight, for 62-63 percent grade standard sinter feed Guaiba (SSFG) for third-quarter contracts, three mill sources with direct knowledge of the matter said.

"We've been told by Vale that we would get a price cut of $2.50 a tonne for SSFG for third-quarter contracts. The market is now changing quickly to a buyer's market and competition among miners is intensifying," said an iron ore buying official with a state-owned steel mill.

Benchmark 62-percent grade iron ore .IO62-CNI=SI hit a 21-month low of $89 a tonne on June 16, but has since edged back to $93.70 a tonne.   Continuación...