Sou Hu Cai Jing·2025-10-07 07:45Core Viewpoint - The sudden shift by Chinese buyers to demand payment in RMB instead of USD for iron ore from BHP has created significant turmoil in the iron ore trade, highlighting the ongoing capital market dynamics and the contrasting responses of major mining companies [1][3]. Group 1: Company Responses - Rio Tinto quickly agreed to the RMB settlement, reflecting its deep financial ties to the Chinese market, which accounts for over half of its revenue and has seen record procurement levels [1]. - BHP, on the other hand, has resisted the shift to RMB, influenced by its American shareholders who are concerned about the potential erosion of the USD's dominance in mineral trade [3]. Group 2: Market Dynamics - The global iron ore market is transitioning from a seller's market to a buyer's market, with increasing supply from countries like Guinea and Brazil, which could threaten BHP's market position if it remains inflexible [5]. - The pricing power in the iron ore market is shifting, with China's Dalian Commodity Exchange now having a trading volume eight times that of Singapore, indicating the emergence of a new pricing center in China [5].