China expands ban on BHP iron ore during ongoing contract negotiations, sources say.

China has expanded its restrictions on iron ore from BHP Group for the second time in two weeks, intensifying a prolonged contract dispute with the world’s third-largest supplier of the key raw material used in steel production.

On Thursday, the state-owned buyer China Mineral Resources Group informed domestic steelmakers and traders that, beginning late next week, they will no longer be permitted to take delivery of Newman fines — a widely traded BHP iron ore product stored at Chinese ports, according to three sources familiar with the matter.

However, customers will still be able to collect shipments that are scheduled for delivery within the next five working days, two of the sources said, requesting anonymity.

One source noted that the move had been expected. “We had anticipated that restrictions on additional BHP products might eventually arrive, so the decision did not come as a surprise,” the person said.

BHP declined to comment, while CMRG did not immediately respond to requests for comment.

Over the past six months, Beijing has gradually tightened controls on purchases of BHP iron ore by domestic mills and traders as negotiations continue over the company’s 2026 supply agreement.

China first banned purchases of Jimblebar fines in September, followed by restrictions on the Jinbao product in November.

Last week, traders were instructed to limit new purchases of Newman fines, Newman lumps, and Mac fines, although buying cargoes already stored at ports was still permitted.
The latest measure now limits purchases only to existing port inventories of Newman lumps and Mac fines.

Spillover impact

Concerned that additional restrictions may soon target the remaining grades, traders have begun offloading their cargoes quickly.

“We plan to sell all Newman fines stored at ports within the next few days and will also try to exit Mac fines positions,” another source said. “Even if Mac fines are not yet restricted, there is uncertainty about when delivery might be banned.”

Meanwhile, benchmark April iron ore futures on the Singapore Exchange rose more than 4% on Thursday afternoon to $108.95 per ton, the highest level since January.

According to another trader, port inventories of Newman fines reached 3.17 million tons this week — an increase of 55% compared with October.

Sources: Reuters