Reuters reported that Germany's largest steelmaker ThyssenKrupp on Thursday became the first European steel producer to announce that it has struck an iron ore supply deal on a quarterly basis.
ThyssenKrupp said it struck an agreement with Vale, which would be valid for the quarter starting on April 1.
It said “Depending on quality, prices for key steelmaking ingredient in ThyssenKrupp’s supply deals will reflect a rise of up to more than 100%.”
It was not clear immediately whether the company would be negotiating with the miners every quarter.
The world's top three iron ore miners Vale, BHP Billiton and Rio Tinto have been pushing to banish 4 decades old annual benchmark pricing system in favor of a more flexible quarterly mechanism. European steelmakers have been resistant to change, saying that they would prefer to keep the annual benchmark system.
A Brazilian newspaper reported on Thursday that Vale has completed iron ore contracts with all of its clients.