FT reported that the Japanese steel industry has started to lock in iron ore prices through the use of derivatives in the clearest sign of the development of a financial market around the commodity used in steelmaking.

The use of iron ore swaps to hedge volatile prices comes after miners and steelmakers ditched the 40 year old system of annual contracts earlier this year, replacing it with quarterly contracts linked to the volatile spot market.

(Sourced from www.ft.com)