(Bloomberg) — Ross McInnes, chairman of BHP Group, said the mining giant is still in commercial negotiations with Chinese state-owned iron ore buyers and pointed out that previous negotiations have lasted for as long as six months.
"We have had a decades-long relationship with China and maintain a quite good working relationship," McInnes said at the company's annual meeting in Melbourne on Thursday while answering a shareholder's question. "But this is an ongoing commercial negotiation, just like every year."
China is the largest consumer of iron ore, and BHP is one of the few major suppliers that provide most of the iron ore to Chinese steel manufacturers. Bloomberg News reported at the end of September that China Minmetals Resources Co., Ltd. has asked major domestic buyers, including steel mills and state trading companies, to suspend new U.S. dollar-denominated sea freight purchases from BHP. McInnes did not directly address this disruption on Thursday.
McInnes said in a press conference after the meeting that some of BHP's previous negotiations with China have lasted up to six months.
McInnes and CEO Mike Henry also responded to speculation that miners would accept more sales denominated in the Chinese yuan. The chairman stated that less than 10% of sales are conducted in currencies other than the U.S. dollar, and Henry added that BHP has already conducted so-called "port sales" transactions in the Chinese yuan in accordance with industry standards.
"It is very sensible for BHP to import iron ore into China and sell it to steel mill customers at the port," Henry said. "These sales will be denominated in the Chinese yuan," he added. The yuan is the abbreviation for the local currency.
Original: www.toutiao.com/article/1846847777258697/
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