By John Kemp
LONDON, April 7 (Reuters) – In a new twist to the iron ore saga, Brazil’s giant iron ore producer Vale has launched a blistering counter-attack on European steelmakers, accusing them of coordinating their approach to ore negotiations in a manner that would raise issues under European competition law.
The accusations are contained in a letter to the European Commission, details of which have been released on the company’s website.
Vale strongly rejects allegations from the steelmakers it has broken European law in discussions about future supply agreements by exchanging information or pricing strategies with any competitor. All major producers insist the market is ferociously competitive.
SUCKED INTO SOMEONE ELSE’S WAR
Vale has been drawn into the spiralling dispute between the steelmakers and BHP Billiton and Rio Tinto over their proposed joint venture in Western Australia as well as the abrupt change from annual to quarterly contracts referenced to the spot market.
Steelmakers are furious about the near-doubling of ore prices this year as well as the switch in contract terms.