2010-08-31 16:59

The top three global mines may cut iron ore prices by around 10 percent in October as China's demand for the mineral falls.

Brazil's Vale, the world's biggest iron ore producer, would cut iron ore prices by 10 percent in October, China Business News reported Tuesday.

This would be the first time the company cut quarterly prices in 2010. The price would decline from $150 to $135 a metric ton.

Vale's prices have surged 170 percent this year, the newspaper said. It announced a raise in third-quarter iron ore prices to $144 a metric ton in May, or 35 percent from a quarter earlier.

Rio Tinto Group and BHP Billiton Ltd also may cut iron ore prices by 11 percent for the fourth-quarter, according to Bloomberg.

Dong Junhao, an analyst with steelhome.cn, told the China Securities Journal that the decline of international crude steel capacity and China's declining demand are the main factors causing the drop in ire ore prices in the fourth quarter.

Baosteel, the country's leading steel maker, is still negotiating with global iron ore producers on the price of iron ore in the fourth quarter, Reuters said, citing the company's chief financial officer, Chen Ying.

Chen said Chinese steel mills had not yet come to a final pricing settlement with the top three global mines, but shipments in the third quarter were currently being priced on a "temporary" basis, according to Reuters.