Australia and New Zealand Banking Group said China could ask Cia Vale do Rio Doce, Rio Tinto and BHP Billiton and other iron ore suppliers to cut prices by 50 percent. This was because the fall in steel prices was not felt in the iron ore prices, one of the main raw materials used for the production of steel, besides coke. As reported here earlier, China has been very upset with the Rio Tinto and BHP Billiton miners ever since both companies practice double standards in selling to them and to Europe. The latter which accounts to less than 3% of the said companies' sales revenue were sold at a much lower price than China's which accounted to nearly 50% of their sales. Will China be able to turn the table around this time to force the bullies to cut their iron ore prices or face the consequences of a potential standoff? Stay tuned!XFN-ASIA: China said iron ore prices should more closely track the decline in steel prices, the official Xinhua news agency reported, citing Shan Shanghua, secretary-general of the China Iron and Steel Association.
"Iron ore prices should be consistent with steel prices, which have fallen to the 1994 level. We will require Rio Tinto and other suppliers to cut prices sharply," Shan said. Benchmark contract iron ore fines sold by Rio Tinto are at around 92.58 usd per ton currently. In 1994 the price was 16.69, implying a decline of up to 82 pct if current prices are made to mirror that year's levels exactly.
* Bloomberg: Rio Tinto to slash 14,000 jobs and cut USD5b in spending.
* Markets in Asia continue to climb....towards 2008's year end window dressing?
* Bloomberg: Democrats, White House agree on the US15B US automakers bailout plan. Congress may vote today.
* The Standard: After proposing a 5T Yen extra spending plan in September, Japan is reported to be considering up to 20T Yen in new stimulus spending to avoid a long and painful recession.
* Interest rate for short term US T Bills has turned negative.
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