(Reuters) -Several cargoes of BHP iron ore went up for sale in China on Thursday and at least one was sold to a local trader, potentially allaying concerns in Australia that Beijing had imposed a ban on iron ore sales from the world’s biggest miner.
BHP sold a 170,000 metric ton cargo to a Chinese trader on Thursday, the first day of trading after China’s week-long national holiday, according to two traders with direct knowledge of the matter. The shipment was paid in dollars, they said.
On the same day, the Shanghai branch of China Mineral Resources Group (CMRG), created in 2022 to centralize iron ore purchasing and obtain better terms from miners, offered eight cargoes of BHP iron ore totaling 1.14 million tonnes to steelmakers, according to an offer sheet reviewed by Reuters.
AUSTRALIAN FEARS OF CHINESE BAN ON IRON EXPORTS
Bloomberg reported last month that CMRG had told major steel producers and traders to temporarily suspend purchases of all new BHP cargoes, escalating an earlier pause in purchases of BHP’s fine Jimblebar product, a type of iron ore, during a deadlock in negotiations over new forward contracts.
That news raised fears in Canberra that China was preparing a ban on Australia’s most profitable export, as it did on coal and other commodities in 2020.
While CMRG told steelmakers last month during negotiations with BHP not to buy BHP’s Jimblebar fines, purchases of other grades of iron ore can be made with CMRG’s permission, two other sources with direct knowledge of the matter told Reuters.
BHP’S JIMBLEBAR FINES TRADE STILL FROZEN
None of the shipments sold or offered on Thursday were fines from Jimblebar, whose trade remains frozen according to the four sources.
Reuters could not determine when CMRG bought its cargoes from BHP or how many cargoes were sold.
CMRG did not respond to a request for comment emailed to Reuters.
A BHP spokesperson said BHP does not comment on trade negotiations.
Jimblebar is a small but liquid product, with about 40 million tonnes produced a year, so a limited shortage is unlikely to trigger a rebound in iron ore prices, the two trading sources said.
Rio Tinto’s flagship product, Pilbara, could also act as a substitute, they added.
Last week, BHP chief executive Mike Henry allayed concerns about CMRG’s decision in talks with Australian treasurer Jim Chalmers, according to local media, saying the move was part of trade negotiations.
The Treasurer’s office did not respond to a request for comment.
(Reporting by Reuters staff in Beijing and Melbourne; Editing by Joe Bavier)