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Monday, 23 March 09
BMA TAKES 60 PCT CUT IN JAPAN COKING COAL PRICE-CITI - REUTERS


BHP Billiton Mitsubishi Alliance (BMA), the world's top coking coal exporter, has agreed to accept a discount of around 60 percent for the steel-making raw material from Japan's Nippon Steel, analysts said.

The deal signals a potential deep price cut in the other steelmaking ingredient -- iron ore -- and helped boost shares of steelmakers, as many firms struggling with falling demand and squeezed margins would be able to slash production costs.

BMA has agreed on a price of between $115 and $125 a tonne for fiscal year 2009/10, a reduction of between 58 and 62 percent from the previous year's $300 a tonne, Citigroup said in a research report.

The price deal, the first between the Australian miner and a key Japanese steelmaking customer, could set a benchmark for other negotiations for contracts for 2009/2010 starting April 1. To read more click
Reuters



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