The $1.1-billion purchase of a stake in ArcelorMittal's (
) Canadian iron-ore unit by China Steel Corp. and Posco increased
interest Wednesday in Canada's ability to meet Asian demand for the
steelmaking raw material, Bloomberg reported.
Champion Iron Mines Ltd. (CHM.TO), Alderon Iron Ore Corp.
(ADV.TO) and Labrador Iron Mines Holdings Ltd. (LIM.TO) surged
yesterday in Toronto after Taiwan's China Steel and South Korea's
Posco led a group that agreed to buy 15% of ArcelorMittal Mines
Canada Inc. However, today CHM is down 5 cents or near 7% and LIM
is 12 cents or 8% lower.
The deal, the second-biggest in the Canadian iron-ore industry,
gives the Asian steelmakers' group access to deposits generating
about 40% of the country's production of the commodity,
ArcelorMittal said on its website.
"It shows you that Canada is an important iron-ore producer and
you've got foreign buyers demonstrating an interest in the product
that we have, the infrastructure and the risks involved in
operating here," said Wojtek Nowak, a Toronto-based analyst at
Fraser Mackenzie Ltd.
Canada is positioning itself as a source of shipments to compete
with Australia and Brazil, the world's two largest iron-ore
exporters. Canada's Champion, Alderon and Labrador Iron plan to
capitalize on the country's supply of skilled labor and its lower
political risk compared with rival iron-ore regions such as West
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