China agrees to nearly double ore price

China's Baosteel said Tuesday it would nearly double the price it pays mining group Rio Tinto for iron ore, in a deal experts said underscored the Asian giant's lynchpin role in the commodity boom.
Baosteel, China's largest steel maker acting on behalf of the nation's industry as a whole, negotiated to pay between 80 and 97 percent more than last year depending on the category of iron ore, which is used to make steel.
"China is a major iron ore importer. So China's iron ore imports will certainly impact the world's iron ore prices," said Lim Shuaik, a Beijing-based analyst with Fitch Ratings.
The new prices will affect all iron ore deliveries for the 2008 contract year that began on April 1, Anglo-Australian giant Rio Tinto said in a statement.
Baosteel called the deal mutually beneficial and said it would help the long-term development of the steel industry on both the mining and milling sides.