Kumba, ArcelorMittal reach pricing agreement

Kumba and ArcelorMittal South Africa have reached an interim pricing agreement for the supply of iron ore from Kumba’s Sishen mine.

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 the Trade and Industry Department.

The dispute arose when ArcelorMittal failed to apply to convert its 21,4% right in the Sishen mine to a new-order mining right by April 30, which led Kumba to cancel a cheap iron-ore supply agreement with the steel-maker.

Under the interim agreement, ArcelorMittal would pay $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