China expands restrictions on BHP iron ore sales

The Chinese state-owned iron ore trading unit of China Mineral Resources Group (CMRG) has reportedly ordered Chinese steel mills and traders to stop purchasing shipments of a second iron ore product from the Australian mining company BHP Group - in particular, low-grade "Jinbao fines," according to media reports. The move follows an earlier ban from September that targeted BHP's Jimblebar Blend Fines.

The bans were introduced amid stalled negotiations between BHP and CMRG on an annual iron ore contract for 2026. The escalation is observed as China uses its purchasing power in the face of weak demand for steel.

In October, BHP Billiton negotiated with CMRG, along with Chinese steelmakers and traders, to switch to Chinese currency (RMB) settlements for 30 percent of its spot iron ore trade with China, with the agreement expected to enter into force from the fourth quarter of 2025, as previously reported. SteelOrbis</p>

Supply and price dynamics change amid dispute

The stoppage of new shipments of fines in Jinbao includes directives to stop shipping from ports for about three days, raising concerns about port congestion.

While the volume of trading in Jimblebar fines is significant for BHP (about 25% of its output), the volume of fines in Jinbao is much smaller, suggesting that the ban is structured in such a way as to exert pressure without causing major market turmoil.

Strategic and diplomatic implications