The West Australian reported that iron ore pellet producer Grange Resources may on sell some of the 800,000 tonnes of product it has contracted to ailing steel maker BlueScope Steel in 2011 financial year.

BlueScope announced the closure of two facilities in NSW and Victoria because of the strong Australian dollar, soft steel prices, high raw material costs and low domestic steel demand, resulting in 1000 job losses.

Grange said in a statement that "Grange is working with BlueScope to assess the impact of their planned production changes on their requirements for Savage River pellets from October 2011 to June 2012. This may include assistance for on selling a portion of remaining contracted off take that BlueScope may determine is not required for its steel making at Port Kembla."

Grange said that Shagang, China's largest private steel mill, would increase its off take from Grange's Savage River mine in Tasmania from about 1.2 million tonnes per annum to more than 2mtpa when the BlueScope contract expired in July 2012.

(Sourced from www.thewest.com.au)