Shandong Iron and Steel Group and other big Chinese steel mills are no longer interested in buying a Chilean iron ore miner they have held talks with, as a slumping economy has left ore supplies ample, company sources said on Friday.

Chilean iron ore firm Sociedad Contractual Minera Hierro Paposo had approached potential Chinese buyers, including the state-owned parent of Wuhan Iron and Steel (600005.SS), eyeing a deal worth hundreds of millions of dollars, industry sources have said.

“We are no longer interested in the offer. The market is not very good now and ore prices have been falling,” a Shandong Steel source with direct knowledge of the deal told Reuters. “The tide has turned now. It’s a buyers’ market.”

Wuhan Steel has more attractive options for access to resources in Australia and Canada, where weaker local currencies offer lower purchase costs, and is unlikely to put money into the Chilean project, an official in the company’s investment section said.

Shandong Steel is the parent of Jinan Iron and Steel (600022.SS) and Laiwu Steel Group (600102.SS). (Reporting by Fang Yan and Alfred Cang; Editing by Edmund Klamann)

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