Rio Tinto Cuts Price of Low-Grade Iron Ore to $73/Tonne; Operator of Cairn Hill Iron Ore Project Placed in Administration
By Vittorio Hernandez | June 20, 2014 8:47 AM EST
The drop in demand for the key steelmaking ingredient continues that a major Australian exporter of iron ore further lowered this week its price of the commodity, while on miner went into administration.
Mining giant Rio Tinto (ASX: RIO) informed two customers on Tuesday that it would discount its low-grade iron ore by 13 per cent from 6 per cent beginning July 1, effectively dropping the price of iron ore to $73 per tonne from the already low price of $89, reports the Herald Sun.
Besides Rio, Fortescue Metals Group (ASX: FMG) has also cut the price of its low-grade iron ore because of the weak demand from China.
Tim Murray, managing partner of J Capital Research, explained the plummeting price of low-grade iron ore to the supply-demand imbalance, causing the price of iron ore to go down 30 per cent from January prices.
The situation has caused Termite Resources, the miner that operates the Cairn Hill iron ore project in South Australia, to be placed in administration. The company is 51 per cent owned by IMX Resources, an ASX-listed company.
Martin Lewis of Ferrier Hodgson is the appointed administrator of Termite. I
According to IMX, Termite is responsible for all contractual obligations for the Cairn Hills project, except for a guarantee it provided under a port handling services deal with Flinders Port.
IMX said the development would have no effect on the ongoing exploration programme at the Ntaka Hill nickel exploration project and the Kishugu gold prospect in Tanzania.
Iron ore prices reached a peak of $135/tonne in 2013.
To contact the editor, e-mail:
Most Popular Slideshows
- Angelina Jolie & Brad Pitt Heads to Malta For New Movie After A Whirlwind French Wedding [PHOTOS]
- Kate Middleton’s Mom Accused Of Being A Social Climber, Prince George Not Seen By Relatives
- Prince Harry & Camilla Thurlow Getting Serious, St. Tropez Holiday Before The Prince’s 30th Birthday [PHOTOS]
- Chris Martin Getting Serious With Jennifer Lawrence, Actress Joining Coldplay Tour [PHOTOS]
Join the Conversation
- Sept 19 iPhone 6 Release Date Firms Up as iWatch Rollout Delayed to Jan 2015 – Reports
- Apple iOS 8 vs Android 5.0 L: OS Wars Puts Android to Lower while Apple to Higher
- North Korea Banker Who Manages Money of Kim Jong-un Defects to Russia With $5 Million
- Malaysia Airlines to Axe 4,000 Employees, Including CEO; Suspends Trading of Shares
- Nexus 4, Nexus 5, Nexus 7, Nexus 10 New Paranoid Android 4.5 Beta 2 Update Guide
- US And Australia Share Visa And Immigration Information
- Finally, OnePlus One Can Be Purchased Without An Invite; Pre-Order Starts From October