Kumba, Mittal deal ends steel wars
23 July 2010
With the help of government mediation, Kumba and ArcelorMittal South Africa have reached an interim pricing agreement for the supply of iron ore from Kumba's Sishen mine, bringing to an end a long-running dispute between the two steel giants.
The agreement would be retrospective to March 1 and would last until July 31, 2011, the parties said in a statement on Thursday.
The deal followed mediation by South Africa's Department of Trade and Industry.
A dispute arose over a contract in which Kumba's Sishen mine supplied iron ore to ArcelorMittal SA at a price of three percent of the cost of production.
When ArcelorMittal SA failed to renew its rights to part of the Sishen mine, Kumba stated it would sell its iron ore to the steel giant at market prices.
Under the interim agreement, ArcelorMittal SA will pay US$50 a metric ton for iron ore deliverable to its Saldanha plant, and $70 per ton or iron ore delivered to its inland plants.
Sapa
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