Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

BHP completes first yuan-based iron ore sale to China's Baosteel

Published 12/05/2020, 06:48
Updated 12/05/2020, 06:50
© Reuters. Visitors to the BHP booth speak with representatives during the PDAC convention in Toronto

© Reuters. Visitors to the BHP booth speak with representatives during the PDAC convention in Toronto

By Min Zhang and Tom Daly

BEIJING (Reuters) - The world's top listed miner BHP Group (AX:BHP) said on Tuesday it had made its first yuan-denominated sale of iron ore to China Baoshan Iron & Steel Co Ltd (SS:600019), known as Baosteel, and would explore using blockchain for such transactions in future.

The deal, worth nearly 100 million yuan ($14.10 million), shows the Chinese currency is making further inroads in iron ore trade after Baosteel, the listed arm of the world's biggest steelmaker China Baowu Steel Group, bought for iron ore from Brazil's Vale SA (SA:VALE3) in yuan in January.

BHP is expecting to be able to complete its first blockchain iron ore transaction with Baosteel soon, it said in a statement. China, the largest iron ore consumer, brought in over 1 billion tonnes of the steelmaking raw material last year and has long sought to gain influence over pricing to help its steel firms weather market fluctuations.

In a separate statement, Baowu noted it had now struck yuan-based deals with the "three giants" of iron ore - BHP, Rio Tinto (LON:RIO) and Vale.

The fourth-biggest iron ore miner, Australia's Fortescue Metals Group (AX:FMC), is also selling in yuan after setting up a trading entity in China in April 2019.

"The active promotion of renminbi settlement in iron ore transactions is not only for operational needs, but also in line with the trend of yuan internationalisation," Baowu said, adding that it had recently concluded its first yuan-based iron ore purchase supported by blockchain technology with Rio Tinto.

© Reuters. Visitors to the BHP booth speak with representatives during the PDAC convention in Toronto

China's iron ore imports jumped more than 11% in April from a month earlier as steel mills raced to restore production after the coronavirus pandemic paralyzed the economy earlier in the year.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.