Negotiations between BHP and China’s CMRG on iron ore may continue until 2026

BHP has reportedly agreed to settle 30% of its spot ore trade with China in yuan

The price dispute between Australia’s BHP Group and state-owned buyer China Mineral Resources Group (CMRG) over iron ore could continue until early 2026, Bloomberg reports, citing sources.

Despite the dispute, the Australian mining company has faced minimal disruptions to its supplies to China and has already fulfilled most of its commitments for November and December.

The real impact of CMRG’s restrictions on BHP’s shipments may only become apparent after the latter begins selling ore for delivery in January 2026 next month. This timeframe may give the Australian group some flexibility in negotiations.

At the same time, SteelOrbis reports, citing market sources and Chinese media, that BHP has agreed with China Mineral Resources Group, as well as Chinese steelmakers and traders, to switch to yuan settlements for 30% of its spot ore trade with China, which includes CFR-based prices at Chinese ports. The agreement will take effect in the fourth quarter of 2025.

However, BHP has decided to set an observation period for the long-term contract for 2026, which will remain in US dollars for now.

According to Reuters, on October 9, several shipments of BHP iron ore were put up for sale in China, and at least one batch was sold to a local trader.

According to two sources familiar with the matter, the company sold 170,000 tons to a Chinese trader on the first day of trading after the country’s week-long national holiday, which was paid for in dollars. On the same day, the Shanghai branch of CMRG offered steel companies eight shipments of BHP iron ore totaling 1.14 million tons.

None of the shipments listed belonged to the Jimblebar blend — trade in this product remains frozen, according to sources.

Recall that at the end of September, Bloomberg reported that CMRG had asked major steel producers and traders to temporarily suspend purchases of any dollar-denominated marine cargoes from BHP Group. Earlier, the state buyer called on steel mills to suspend purchases of Jimblebar mix, and the new directive expanded the previous restrictions.