Capital market-relevant press releases, 2006-05-16, 11:46 AM
Ore prices for ThyssenKrupp Steel to rise by less then ten percent
Ore prices for ThyssenKrupp Steel AG will rise by less than 10 percent on average this year. The contracts were signed Monday evening in a pilot deal with the Brazilian company Companhia Vale do Rio Doce (CVRD), the world's largest ore producer. Under the deal, prices for fine ore will rise by 19 percent while pellet prices will fall by three percent. This agreement was the first for the steel industry in the current year, which began April 1. "In view of the situation on the raw material markets we can be satisfied with the terms on the whole because they are well below the ore producers' initial demands," said Dr. Karl-Ulrich Köhler, Executive Board Chairman of ThyssenKrupp Steel AG. "However, what we urgently need are more ore mine development projects to create a market balance. A better balance of supply and demand is vital if we are to achieve a win-win situation for producers and consumers in the long run."
According to an IISI study, world ore production capacities will rise from roughly 1.3 billion to around 1.7 billion tons per year in the period 2005 to 2010, an increase of 27%. Brazil and Australia alone will increase their production capacities by around 35% from 2005 to 2010. Additional production capacities could be developed to meet further growth in steel demand.
This press release is also available on the internet at: www.thyssenkrupp-steel.de