Author: Paul Ploumis10 Oct 2014 Last updated at 04:50:35 GMT
CANBERRA (Scrap Monster): The head of Rio Tinto iron ore unit, Andrew Harding, stated that, the rivals and analysts who states that, the company itself and its long rival BHP Billiton are destroying the price of iron ore by increasing their production and supply in the market, were completely wrong. He further added that, if the companies decrease the production and leave out a space, other producers or the new starters in the iron ore industry might fill the space producing more iron ore. The company’s recent analysis, states that, if they leave out the space, or decrease the volume of production, there are other 32 competitive projects and firms waiting for their opportunity.
He also stated that, the company has decided on increasing its production to 360 million tonnes by next year, and the company is also confident that there will be long term demand for iron ore from India, China and other Asian Countries.
Not long after the comment from Harding, the Premier of Western Australia, Colin Barnett, came up with strong criticism for both the giants of iron ore industries, BHP Billiton and Rio Tinto. He stated that, the plans of both the companies, to flood down the market with their produce would drag down the price of iron ore to its minimum. He reminded both the companies that, the majority of their mines, stands in western Australia, and they shouldn’t be forgetting that. He further added that, the decline in the price of iron ore would decline the economy of Western Australia.
The Premier further stated that, he would not like t9oo increase the royalty rates of both the companies for the every tonne of iron ore they dug out of the ground, but if things go on like this and if the price continues to decline, the government would have no other choices left than to increase the royalty rate of iron ore.