Vale, Fortescue Game-Changing Deal to Shake Up Big Iron Ore
- Strategy seen intensifying competition with BHP, Rio Tinto
- Pact follows iron ore's biggest one-day price gain on record
This article is for subscribers only.
A pact between two of the world’s largest iron ore producers promises to intensify competition among the sector’s top four players, just as Chinese demand is forecast to falter after the nation’s production of steel peaked.
The agreement between Brazil’s Vale SA, the biggest supplier, and Fortescue Metals Group Ltd., the No. 4 exporter, includes plans to develop joint ventures to create about 80 million to 100 million metric tons a year of a blended product that would compete more closely for customers with output from BHP Billiton Ltd. and Rio Tinto Group.