Brussels, 01/04/2010 (Agence Europe) - On Wednesday 31 March, several European industrial federations called on the European Union to prevent an excessive surge in the price of iron ore, which would affect competitiveness especially for the automobile industry.
Eurofer (European Confederation of Iron and Steel Industries), the main federation in the steel sector, officially told the European Commission of its suspicions that iron ore suppliers were conducting malpractice in breach of competition rules and using their dominant position abusively. Eurofer and the European Automobile Manufacturers' Association (ACEA) are concerned by the hike in mineral ore prices after the announcement of agreements reached by the mining groups Vale and BHP Billitoin on a change in their tariff tactics. The Italian federation of the associations of mechanical and engineering industries, ANIMA, is also calling for measures against the “unwarranted price rises for raw materials”.
In an open letter to the European authorities, Eurofer states that the control exercised by the three main groups on nearly three quarters of the world iron ore market brings about an imbalance of pricing practice. The European Commission said it did not foresee a new investigation on this but would, according to Reuters, announce that the content of Eurofer's letter will be useful for the inquiry already underway on the proposed joint venture between BHP and Rio Tinto.
Vale and BHP Billiton, which rank first and third respectively for the production of iron ore, have announced that the price of mineral ore supplied to Japanese steelworkers would now be fixed on a quarterly base and no longer by annual agreements. In certain contracts, this change should bring about a 90% rise in mineral ore prices compared to last year. (L.C./transl.jl)