(Yicai Global) Aug. 4 -- China's Ansteel Group and London-headquartered Rio Tinto Group have completed their first iron ore settlement in Chinese yuan.

A unit of the state-owned firm paid the CNY100 million (USD14.3 million) transaction in its local currency to the mining giant that sent the commodity to China from Australia on Aug. 1, the Paper reported yesterday. The deal signals a milestone in the redback's internationalization.

Paying cross-border iron ore purchases in renminbi can help domestic buyers avoid exchange rate fluctuations while foreign firms can widen their business in China with the funds, industry insiders told the same news source.

Ansteel will explore applying new digital technologies such as blockchain and cloud transactions to improve the efficiency and reduce the cost of payments, the firm added. The Liaoning province-based company purchases millions of tons of iron ore from Rio Tinto every year.

Other Chinese companies have sought to switch to the local currency too. In the first half of this year, state-owned China Baowu Steel Group settled some cross-border deals with three major global iron ore giants Brazil's Vale, Australia's BHP Group, and Rio Tinto in Chinese yuan.

Editor: Emmi Laine