Hoa Phat co-operates with four world’s largest iron ore mining companies in Australia

Hoa Phat Dung Quat Steel Joint Stock Company had a visit and working with world’s largest iron ore mines in Australia. Hoa Phat established partnership with Top 4 iron ore suppliers in Australia – the biggest exporter of iron ore in the world. This has shown new position of Hoa Phat in international goods transactions.

The Hoa Phat’s delegation visited and worked with largest iron ore exploitation and production partners in Australia, Hadland Port – the world’s largest ion ore export port with capacity of 500 million tonnes per year. The visit aimed to seek for stable and long-term iron ore supply for Hoa Phat’s steel factories, especially its Hoa Phat Dung Quat Integrated Steel Complex. In addition, they also had meetings with southern Australia and Australia Mining Association (AMA).

Statistics in 2016 showed that Australia exported around 808 million tonnes of iron ore per year, accounting for 55 per cent of the total transactions in the world. Of which, 91 per cent of Australian iron ore focuses in the Western Australia which is suitable for metallurgical and enjoys many preferential policies from the government.

Australia is the world’s biggest iron ore exporter

Mrs. Vuong Ngoc Linh – deputy director of Hoa Phat Dung Quat Integrated Steel Joint Stock Company said the world’s largest iron ore mine Vale in Brazil has been the regular supplier for Hoa Phat. The group wanted to establish new co-operation with big and oldest producers such as Rio Tinto with output of 329.5 million tonnes per year, BHP with 227 million tonnes per year, FMG with 170 million tonnes per year and Royhill with 55 million tonnes per year.

The mining companies have biggest exploitation capacity and applying most advanced automation technologies in the mining sector as well as having their own railways and port system. Representatives of the mining firms in Australia highly valued big and potential steel project of Hoa Phat Group and expected to provide all of iron ore demand to the group in the long-term period with the best commercial conditions and most competitive prices.  

Mrs. Vuong Ngoc Linh – deputy director of Hoa Phat Dung Quat Steel JSC (left) said Hoa Phat and its suppliers would continue to have meeting and discussions on special technical and trade issues in Viet Nam to reach iron ore agreements for their Hoa Phat Dung Quat Integrated Steel Complex

In addition, the wharf at Hoa Phat Dung Quat Integrated Steel Complex could receive 120,000 tonne ships by the end of 2018 and receive ships of up to 150,000 tonnes by the end of 2019. This advantage helps Hoa Phat to purchase iron ore at the price similar with the world's largest steel mills, even lower than prices traded in the market.

Hoa Phat planned to buy materials for hoa Phat Dung Quat Integrated Steel Complex based on term contracts from 1-3 years to ensure stable supply as well as quality for production. In the coming time, Hoa Phat and its suppliers will continue to meet and discuss technical and commercial matters in Viet Nam to reach the iron ore supply agreement for the project. It is expected that material purchase contracts of Hoa Phat Dung Quat Steel JSC will be completed before the second quarter of 2018. The first shipment is expected to arrive in the fourth quarter of 2018.

Establishing relationships with the five largest iron ore suppliers in the world has brought Hoa Phat in a new position, opening new prospects for buying methods, creating a stable supply of high quality iron ore with the lowest price for Hoa Phat Dung Quat Integrated Steel Complex. This could help reduce production cost and increasing competitiveness for Hoa Phat steel products in both domestic and foreign markets.

                                                                                               Nghi Tran