Glencore International AG, the world’s biggest commodity trader, said Brazilian steelmaker Cia. Siderurgica Nacional SAdefaulted on a purchase of $105 million of steelmaking raw materials.
CSN refused to accept or pay for three metallurgical coke shipments, according to documents filed with the U.S. District Court in Indianapolis on Nov. 19. Baar, Switzerland-based Glencore is seeking damages of about $36 million. The action is being taken against a U.S. subsidiary of CSN. The cargoes were agreed to in July and August.
CSN’s press office in Sao Paulo declined to comment when reached yesterday. “There is no pending dispute between the parties,” Glencore spokesman Marc Ocskay said today in an e- mailed statement. No settlement notice has been issued by the court.
Metals demand has plunged as the global economy slows, sending prices of steelmaking raw materials tumbling. CSN, Brazil’s third-biggest producer, said Nov. 18 it may cut steel prices by 5 percent next year as domestic demand stagnates. The country’s exports of the metal fell 26 percent in October, the Brazilian Steel Institute said yesterday.
Chinese coke prices dropped 52 percent since reaching a high for this year in July, according to data compiled by Beijing Antaike Information Development Co. Spot iron ore prices have declined 62 percent this year, according to data compiled by Metal Bulletin.
Closely held Glencore is owned by its employees and trades oil, metals and agricultural commodities. It owns 34 percent of Xstrata Plc, the world’s fourth-largest copper and nickel producer and runs mines and smelters around the world.
Cathy Elliott, a lawyer at Bose McKinney & Evans in Indianapolis for the steelmaker’s CSN LLC unit, didn’t immediately respond to a message left yesterday requesting comment.
The three shipments were for 45,000 metric tons each. One was priced at $780 a ton and the others at $775 a ton.
