Rio Tinto says iron ore exports remain at record
SYDNEY, July 6 (Reuters) - Rio Tinto (RIO.L) (RIO.AX), the world's second largest iron ore miner, says Chinese buyers are choosing to pay spot market prices for iron ore and it is shipping material from its Western Australian mines at record rates.
Rio said demand for iron ore from Chinese buyers remained strong even though it had not yet struck a deal with the country's steel mills for shipments in the 2009-2010 contract year under the traditional benchmark pricing system.
"We're selling everything we make -- we've never been as busy," said Rio Tinto Iron Ore spokesman Gervase Greene.
Greene said Rio Tinto was selling iron ore to Chinese mills at spot prices after failing to agree annual contact prices.
"Instead of buying under contract, they just chose to buy at whatever the prevailing rate is on the day," he said. "At the moment that's about $82 so we're selling it at a higher price than if they had agreed (to the 33 percent cut) so that's where it's at."
"We believe in the benchmark system but if, at the end of the day, customers want to pay spot prices that's up to them," Greene said. (Editing by Michael Urquhart)
