Iron ore pellet producer Bahrain Steel and Anglo American have signed a 20-year contract worth about US$15 billion to supply iron ore pellet.

Anglo American will provide up to 8 million tons of iron ore pellet to Bahrain Steel's two production lines a year, with an annual output of 12 million tons of iron ore pellet.

The agreement was based on a 2012 transaction that provided at least 67% of iron ore supply, supplied by Anglo American's Minas-Rio mine in Brazil. Its raw materials will enable Bahrain Steel to produce high quality direct reduction pellets (DR pellets) deposits with more than 67% iron.

Bahrain Steel said that the agreement with Anglo American can guarantee the raw materials of iron ore pellet required by customers in the Middle East and North Africa and other regions, and these customers were increasingly relying on the supply of DR pellets for Bahrain Steel.

In addition to purchasing iron ore from Brazil, Canada, Chile and Sweden, Bahrain Steel also purchased raw materials of iron ore pellet from Mexico and Turkey last year.