Fortescue Metals Group (Fortescue) has signed 12 Memoranda of Understanding (MOUs) with major Chinese steel mills, procurement partners and financial institutions on the sidelines of the third China International Import Expo (CIIE 2020), valued cumulatively in the range of US$3 to US$4 billion.
Over two days of events, Fortescue signed MOUs with long-term partner and major shareholder Hunan Valin Iron & Steel Group Co., Ltd (Valin Group) for the supply of iron ore and procurement opportunities, as well as the Bank of China Limited, Sydney Branch (Bank of China) for strategic cooperation. Fortescue has also signed an additional nine MOUs with Chinese steel mills and procurement partners, including:
Chief Executive Officer, Elizabeth Gaines, said “Since the Company’s inception, Fortescue has built enduring relationships with our stakeholders in China. Our engagement extends beyond iron ore supply to longstanding customer relations, procurement and financing arrangements as well as academic, policy and social linkages.
“Fortescue’s success and that of the Australian economy has been built on the great powerhouse that is China. Now, more than ever, these strong trade relationships provide economic stability as we work together to build new opportunities for the future.
“China's steel industry continues to outperform expectations, with crude steel production in the nine months to September 2020 reaching 782 million tonnes, and annual steel production expected to exceed 1 billion tonnes in 2020. The strength in demand for iron ore continues to play an important role in Australia’s economy, growth and development.
“We are proud to sign MOUs with Valin Group, the Bank of China, steel mills and other procurement partners, demonstrating the breadth and depth of our relationships in China. Through this multifaceted approach, Fortescue has forged strong partnerships with customers and businesses in China that have significantly contributed to China’s remarkable urbanisation and development and our Company’s contribution to the economic prosperity of Australia and Western Australia.
“It was particularly pleasing to recognise Fortescue’s longstanding relationship with Valin Group, who has been a significant shareholder in Fortescue since 2009 and is our second largest shareholder. Further to the MOU for the ongoing supply of iron ore, we have signed a Strategic Cooperative Agreement for Fabrication Supply with Valin Group which builds on our track record of partnering with Chinese manufacturers for the supply of equipment and infrastructure,” Ms Gaines said.
“Fortescue is investing in significant projects in Western Australia, creating jobs, and continuing to build and maintain the strong relationships we have with our customers, suppliers and other stakeholders.”