Tuesday, June 2, 2009.

From Creamer Media in Johannesburg, I'm Shannon O'Donnell.

Making headlines today:

Chinese steel mills are to offer a new proposal in benchmark iron ore price talks. This is less than a week after their rivals in Japan and South Korea offered to pay more than expected.

But the new proposal wouldn't water down China's demand for a drop of at least 40 percent in iron-ore prices, winding the clock back to 2007.

China has the world's biggest steel sector and traditionally sets annual benchmark prices after months of talks with top iron ore suppliers Vale, Rio Tinto and BHP Billiton.

This year China, the only major producer with higher steel output than last year, is enjoying a flood of iron ore imports, thanks to collapsed world prices, cheap freight rates, relatively high-cost domestic ore and its uniquely buoyant steel sector.

But Chinese mills were stunned last week when Rio Tinto agreed to a 33 percent price cut with Japan's Nippon Steel and JFE Steel and South Korea's POSCO, putting pressure on China to compromise or rely on spot market prices staying low for the next 12 months.

Criminal charges have been laid against 294 illegal miners at one of South African gold major Harmony Gold's old shafts, while 36 bodies had been recovered at the shaft.

On Monday, Harmony reported that 294 illegal miners had been brought to surface at its Eland shaft, in the Free State.

Harmony Gold South Region COO Tom Smith said that the shaft was no longer in operation, with only the shaft barrel operating to pump water out of the shaft.

He said that the illegal miners have been charged with trespassing and with illegal dealing in, or the possession of, gold.

The illegal miners had stolen mostly gold, although a small amount of copper had also been taken.

Also making headlines:

Analysts report that the base-metals outlook remains weak, while the gold price is seen to be improving.
Kazakhstan will review all state asset sales.
Rockwell Diamonds challenges Pala Investments to come clean on its 'restructuring'.
And, Canada's Goldcorp plans a 750-million-dollar note offering.

That's a round up of news making headlines today. For more on these and other stories please visit miningweekly.com.