ALUMINUM Corp. of China Ltd., the nation’s biggest producer of the lightweight metal, is concerned a combined BHP Billiton Ltd. and Rio Tinto Group would concentrate raw material supplies and may wield too much pricing power.

“Yesterday, someone told me that if they combine copper ore and iron ore, prices may double next year,’’ Luo Jianchuan, president of Beijing-based Aluminum Corp. of China Ltd., known as Chalco, said yesterday. “It makes us worried.’’

China Shenhua Energy Co., the world’s second-biggest coal seller, and Yunnan Copper Industry Co. have raised concern about a merger that would control more than a third of the global iron-ore market and produce the most aluminum and copper. China is already hurting from a threefold gain in commodity prices since 2002.

“BHP and Rio’s combination will give them more pricing power in iron ore because they are two of the three biggest suppliers,’’ Luo Wei, a Shanghai-based analyst with China International Capital Corp., said.

“The possible combination will concentrate copper ore supplies,’’ Chalco’s Luo said.

Chalco’s parent, Aluminum Corp. of China, last month bought a controlling stake in Yunnan Copper Group Co., the biggest metal acquisition in the nation this year. Yunnan Copper Group buys copper concentrate from BHP and others to process into the metal.

A combined BHP and Rio would control 38 percent of the seaborne iron ore trade, said Australia & New Zealand Banking Group Ltd. Iron ore prices may rise 50 percent next year due to surging Chinese demand and the inability of mining companies to meet demand, Macquarie Group Ltd. said last month.

The combined company would account for 14 percent and 13 percent of the global share of energy coal and copper respectively, Citigroup Inc. said. BHP would also gain control of the world’s largest aluminum producer, which Rio became after buying Montreal-based Alcan Inc. for US$38.1 billion this year.

BHP chief executive officer Marius Kloppers is promising to deliver faster supply at lower costs to meet a five-year rally in commodities demand.

“There is no doubt that a BHP, Rio combination will over time fundamentally alter the shape of the cost curve,’’ Saxon Nicholls, who manages the equivalent of US$840 million at Herschel Asset Management Ltd., said in Melbourne. “If you do bring the businesses together you can affect both operating costs on future projects and capital expenditure.’’

Kloppers told reporters Nov. 12 he hasn’t “detected any hostility’’ from Chinese steelmakers to the takeover proposal.

Shougang Corp., China’s ninth-biggest steelmaker, said Nov. 9 that a combination of BHP and Rio may lead to higher iron ore prices. China Shenhua Energy’s president Ling Wen this week said news of BHP’s proposed takeover for Rio was spurring its own acquisitions plans.

Chalco’s Luo also said he was unaware of any plans by Chinese companies to buy a stake in Rio. (SD-Agencies)