Thursday, June 26, 2008

Another Price Increase

Since we are paying more for food, fuel, ammo, and MATC, I thought you'd like to know that the price of iron will escalate signficantly, too.

Iron ore giants Rio Tinto and BHP Billiton announced that they had come to agreements with key Chinese steelmakers, agreements that hike the base price of iron ore by 86% over a year ago. The combination of ever increasing demand, especially from China and India, along with the power that the three-company iron oligopoly has over the much more competitive steel industry did the trick. Iron ore is a sellers market, and there are only a few sellers.

The price was the result of negotiations with Baosteel, China's #1 steelmaker, but will apparently apply to all other steel companies that buy from the two Australian iron giants. It will also apply retrospectively to all iron bought from those companies since April 1.


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