Vale, Nippon Steel Iron Ore Deal
Vale (NYSE:VALE) and Nippon Steel have entered into a tentative quarterly agreement which would increase the price of iron ore by 90 percent, bringing the price to $105 a ton.
This is the first move by Vale into the quarterly pricing market, which originally they had opposed; this is significant because they're the largest producer of iron ore in the world.
The price is in line with market expectations of between $100 to $105 a ton.
A price increase like this would be a good result for Vale and other major iron ore producers, as it would generate a nice increase in revenues and earnings.
The deal is tentative because the two sides haven't come to complete agreement on the overall deal. Whatever the price ends up being, it will be applied retroactively, staring April 1.
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