Australian mining giant BHP is facing an expanded iron ore ban from China after state-owned iron ore buyer China Mineral Resources Group (CMRG) ordered steel mills and traders to stop purchasing a certain type of BHP iron ore, sources told Reuters.
CMRG asked steel mills and traders not to buy new cargoes of Jinbao fines, a low-grade iron ore from BHP.
CMRG, which was set up in 2022 to centralise iron ore purchasing, told mills not to take delivery of Jinbao fines from ports in three days.
The ban expands another ban after CMRG asked Chinese steel mills and traders in September to stop buying BHP’s Jimblebar Blend Fines.
BHP and CMRG have been in lengthy discussions over an annual contract for 2026.
The latest directive may be a countermeasure against a workaround used by some buyers, who mix Jimblebar with Jinbao to avoid inspections.
CMRG may have also chosen to target Jinbao fines instead of other BHP ores, as trade in the lower-grade ore is very small and the fines would not disrupt the market.
BHP said in a response to the news agency that it does not comment on commercial negotiations.
CMRG did not respond to Reuters queries about the matter.
