China's Ban on BHP Iron Ore Shipments Affects Trade

China Bans BHP's Iron Ore Cargoes

China has banned all iron ore cargoes belonging to BHP Group due to price disputes. This development was undertaken by the China Mineral Resources Group (CMRG), which aims to increase China's influence in global trade as the world's largest iron ore consumer.

CMRG Directs Local Buyers

CMRG instructed local buyers this week not to purchase dollar-denominated overseas shipments from Australian-based BHP. This decision came after unproductive negotiations late last week and signals CMRG's tougher stance against BHP.

BHP's Role in Iron Ore Supply

BHP is one of the three major suppliers providing a significant portion of the global iron ore supply. CMRG was established in 2019 to give China's steel industry more bargaining power against major miners like BHP, Rio Tinto, and Vale.

Production Changes and New Restrictions

Sources state that previously imposed restrictions have been further tightened. CMRG instructed mills not to accept BHP's Jimblebar shipments at Chinese ports and not to purchase such cargoes from the yuan-denominated spot market. These measures have led some steel producers to turn to alternative ores.

Responses from Companies

CMRG has not yet responded to requests for comment. However, a BHP spokesperson stated that the company cannot comment on commercial arrangements.