Rio Tinto’s latest iron ore trading network

One of the reason why Australia was able to stay out of the economic crisis is due to China’s interest in Australia’s resources. Regardless of past criticisms, the trade and business between the two countries is important for both. China accounts for 60 percent of the global seaborne iron ore trade and has the world’s largest iron ore spot market. No country will turn their back to this growing market.

Rio Tinto,  the world’s second-largest iron ore miner, joined China Beijing Metals Exchange, China’s first spot iron ore trading platform, on Friday. This will help boost the country’s clout in pricing the key material, analysts said.

From Rio Tinto’s website it is obvious that such agreement will pave new opportunities for  future collaborations between the company and the Chinese market.

Reuters also reported that the Beijing-headquartered exchange will bring steelmakers from China, the world’s largest consumer of iron ore, and leading iron ore producers onto a common platform, after the top miners abandoned a 40-year annual benchmark pricing system in 2010.

From Rio Tinto’s website and latest media release, it says that:

Rio Tinto has become a member of the new China Beijing Metals Exchange (CBMX). The CBMX is an electronic trading platform that will provide participating members with an additional iron ore trading channel in the China market.

A signing ceremony was held in Singapore earlier today between senior officials of CBMX and Rio Tinto Iron Ore Asia, which markets iron ore on behalf of Rio Tinto to its Asian customers.

Rio Tinto Iron Ore Asia president Alan Smith said “We welcome the development of CBMX as it gives us a new option for selling any available tonnes to China, over and above those already contracted. We look forward to the Exchange developing into a transparent, independent, efficient and sustainable iron ore trading platform supported by broad market participation.”

Du Juan and Zheng Yangpeng from China Daily and  Rio Tinto’s Media Release

 

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