(9 October 2025 – Australia) Australian mining giant BHP Billiton has agreed to switch settlement to Chinese Renminbi (RMB) for 30 percent of iron ore spot trading with China involving cost and freight (CFR) based prices at Chinese ports.
The agreement with Chinese state-owned iron ore trading arm China Mineral Resources Group (CMRG) together with Chinese steelmakers and traders will commence from Q4 2025 according to market sources and Chinese media. Iron ore negotiations between BHP and CMRG represents one of the most significant commodity relationships in the global economy with critically important implications for both parties.
As reported by SteelOrbis, last month Chinese buyers suspended iron ore trading in USD with BHP and amid negotiations for long-term contracts, seeking to increase power in the iron ore market dominated by large global miners. Following negotiations BHP compromised and agreed to settle in RMB.
Using RMB for settlement not only requires a change in currency, but also demands the integration of domestic bank loans, cross border payment systems and FX hedging to form a closed loop for the process. Four major miners – UK/Australia’s Rio Tinto, Australia’s BHP Billiton and Fortescue and Brazil’s Vale, account for 70 percent of Chinese iron ore imports with BHP exports totalling 295 million tonnes in fiscal year 2024.
“China wants to assert control over pricing after years of frustration at being the world’s biggest buyer but still having little say over the price. It is also a signal to the rest of the world that China intends to play by new rules” commented University of Technology Sydney Australia-China Relations Institute Researcher, Marina Zhang.