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Ms Gina Rinehart's Roy Hill project is focusing on the quality of iron ore-铸件展-铸件采购会-国际铸件展-2015第十六届广州国际铸件展会-巨浪展览-The 16th China(Guangzhou )Int’l Casting product Exhibition
12/9/2014 铸件展-铸件展会-casting expo |
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SMH reported that the man who helped seal USD 7.2 billion debt package for Mr Gina Rinehart''s Roy Hill project has conceded that such a deal would be harder to close in the present environment, given the recent collapse in iron ore prices.
The Roy Hill debt deal was closed in the final week of March, a month in which the iron ore price averaged USD 112 per tonne, well above the USD 79.4 per tonne seen this week.
Mr Garry Korte chief financial officer of Roy Hill noted that the good timing of the deal and Roy Hill would focus on making sure the quality of its product was good enough to attract the best possible price. The finance closed in March. I''m very happy that we closed it at that stage, it would be a little bit more challenging today..”
Mr Korte said that "We produce a product that is largely going into Japan and Korea and that is a market that values quality very highly and so for them it is absolutely critical that we produce consistent product and quality product."
Roy Hill is a joint venture between Ms Rinehart''s Hancock Prospecting and South Korean steel giant POSCO, Japanese company Marubeni and Taiwan''s China Steel Corporation.
Mr Korte said that the Asian joint venture partners were attracted to invest in the USD 10 billion Roy Hill project because it would give them a secure stream of the type of quality iron ore they wanted.
The quality of iron ore is more important than ever before, with producers of lower grade iron ores forced to accept increasingly wider discounts than at any time over the past decade.
He said that "The Asian steel mills continue to see more and more variability in quality, they see declines in grades and increases in contaminant levels, and that was part of the rationale that drove them to invest into Roy Hill."
He added that "There is at least a 20% price differential for marginal differences in quality so for us 20% of the selling price of iron ore is a very significant number and dwarfs a lot of cost saving opportunities."
铸件展-铸件采购会-国际铸件展-2015第十六届广州国际铸件展会-巨浪展览-The 16th China(Guangzhou )Int’l
Casting product Exhibition
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