BHP Billiton Limited said that the trend toward market based pricing of iron ore will continue, as it pushes to change the way the commodity is priced.

BHPB added that "Transparent and regular pricing allows customers to mitigate risks on short, medium and long term contracts."

Iron ore and coking coal suppliers traditionally hold annual negotiations with steelmakers to fix benchmark prices that take effect from April 1st 2010, the start of the Japanese fiscal year. Negotiations took at least six months in 2008, and last year they failed to produce a recognized benchmark price. BHP also produces copper, oil, aluminum and silver, which are sold at market prices.

BHP boosted sales from Western Australia on a mix of cash, quarterly and index pricing to 46% in the fiscal first half, from 30% in the previous half.

Iron ore was BHP’s third most profitable unit in the six months through December 31st 2009 with USD 2.09 billion or 24% of the company's total EBITDA.

(Sourced from www.bloomberg.net)