Industry meltdown possible if miners stick to price hike

BEIJING - Chinese steel mills have expressed their reluctance to accept iron ore prices of potentially $160 per ton proposed by Vale and BHP in the third quarter, saying that the price hike will create carnage in the nation's steel industry.

"BHP has recently informed us that they will raise third quarter iron ore prices, including freight, to $160 a ton, which is unacceptable for us," according to an official from a large steel mill in northern China, adding that the request from the miner was "tentative" to test the market.

"We will become unprofitable with such prices on the back of a persistent fall in steel prices," the source said.