Australia’s Prime Minister Anthony Albanese expressed concern about disruption to Australia’s iron ore exports after reports emerged on Wednesday that a state-run Chinese iron ore buyer had told steelmakers and traders to temporarily halt purchases of shipments from Melbourne-based global mining giant, BHP.
China Mineral Resources Group Co’s move against the world’s biggest miner, BHP, escalates an impasse in contract negotiations, news media reported.
“I want to see Australian iron ore be able to be exported into China without hindrance. That is important. It makes a major contribution to China’s economy, but also to Australia’s,” Albanese told reporters.
“These measures are always disappointing. But let’s hope certainly that they are very much short term. Sometimes when people are negotiating over price, sometimes these things will occur. But I want to see this resolved quickly,” he added.
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The China Mineral Resources Group Co asked domestic buyers this week to suspend purchases of any dollar-denominated seaborne cargo from BHP, people familiar with the matter told a leading US news agency, asking not to be identified because they were discussing private deliberations.
The Chinese company, created by Beijing to bolster the country’s sway in the global iron ore trade, did not respond to requests for comment, it was reported.
While this means that new deals can’t be signed, including for cargo that has already left Australia, where BHP’s miners are located, the company said it could not comment on commercial negotiations.
Treasurer Jim Chalmers said he would arrange a meeting with BHP chief executive Mike Henry to discuss the Chinese trade.
“I've seen those reports, they're concerning reports. Ultimately, though, they are about the commercial arrangements between two companies and so in one respect, a matter for the company to work through,” Chalmers told reporters, referring to reports of the BHP boycott.
“This is a government that advocates for Australia's interests on the world stage, with our major trading partners. You can expect that to be the case again. (We will) work through these issues calmly and carefully, advocating for the workers and businesses and investors of our country,” Chalmers added.
China has lifted a series of official and unofficial trade barriers since Albanese’s government was first elected in 2022. The trade impasse had been costing Australian exporters up to 20 billion Australian dollars (USD 13 billion) a year. But Australian iron ore was spared previous trade barriers due to its importance to Chinese steelmakers.
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