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Tuesday, April 28, 2009

Fortescue Suspended From Baltic Exchange in London


Fortescue Metals Group Ltd., Australia’s third-biggest iron-ore exporter, was suspended from being a member of the Baltic Exchange, the world’s largest shipping bourse. It’s the first suspension since 2005, exchange spokesman Bill Lines said by phone today, declining to comment further. The bourse’s 560 members include ArcelorMittal, the world’s largest steelmaker, and Glencore International AG, the biggest commodities trader. East Perth, Australia-based Fortescue has yet to receive official notification from the exchange, company spokesman Cameron Morse said by phone. Fortescue is scheduled to start arbitration over shipping contracts in June, Morse said.
The action will have “little operational effect” on Fortescue, Morse said. The primary role of the Baltic Exchange is to provide price data that commodity producers and oil companies use as benchmarks for their shipping costs. Its data is also used to settle freight-derivatives contracts.
Greek shipping billionaire John Angelicoussis sued Fortescue for $130 million in December, according to a Dec. 11 filing in a U.S. federal court in New York. Ship-rental rates plunged by a record 92 percent last year.

Source: Alaric Nightingale, Bloomberg