Chinese Iron Ore Negotiations In The Second Round Did Not Price The Bottom Line

China Steel Industry Association executive vice president and Luo

, 30, said the Secretary-General, International Maritime fiscal 2008 iron ore price negotiations have entered the second round of negotiations the Chinese side there is no bottom line price.

Deny "that increase the bottom line,"

Luo said the iron ore price negotiations in fiscal 2008 and fiscal year 2007, basically the same, still the "three on three" pattern, that is, CVRD (Vale), BHP Billiton (BHP) and Rio Tinto (RioTinto) three iron ore producer and the Baosteel Group, Nippon Steel and European steel companies to negotiate.

To him, by the end of November 2007, began to prepare negotiations on iron ore supply and demand sides, the development trend of steel, iron ore supply and demand situation was predicted. Since December, both sides to enter formal negotiations, "now the first round has ended, the second round under way."

Luo said that the current supply and demand of the big differences, continued exchange and communication among, "the next step to progress, remains to be seen."

He said China Steel Association, the so-called long Zhang, general manager of Anshan Iron and Steel Group in the negotiations of the report is totally based on the current negotiations the Chinese side is still smooth under the guidance of Baosteel.

On the market, "China's the bottom line is 30%" of the rumors, Luo clear that China does not exist "what must be achieved, must be how much," the bottom line, and that the bottom line is not conducive to negotiations predetermined normal work.

He also said that negotiations in this round of iron ore, China does not pursue "a certain first (agreement)," but how do we help our steel industry.

Market supply and demand balance Luo believes that the international iron ore in 2008 the basic balance between supply and demand, and even better in 2007.

, He said, "China needs" perspective, in 2008, due to uncertain factors increased significantly, China's pig iron output growth will be lower than in 2007. First, domestic demand growth from the second half of 2007 decreased 14.11% to 12%; second, iron and steel exports will be significantly lower than in 2007, is expected to reduce 20 million tons; Third, and hikes resulted The new price rise factors, China's steel production is facing increasing cost pressures, some small businesses may reduce steel production; Fourth, national saving and emission reduction and elimination of backward strength, will also inhibit the growth of steel production.

"2008 China's import of iron ore demand growth will fall." Luo believes that China's imports of iron ore in 2007 compared to last year's increment of 57 million tons, is expected to decline in 2008 to 40 million tons "This is a favorable balance between supply and demand."

2007 12 months, China imported iron ore CIF price was 128.28 U.S. dollars an integrated average / ton, up 83% year on year. "This is a departure from the value, twisted, iron and steel enterprises in China can not accept." He said.

Firmly opposed to a long association stock transfer

Recent market rumors, Rio Tinto iron ore required to sign a long-term contract to the extent permitted, 10% reduction in supply. In this regard, Luo confirmed: "The Chinese steel industry really has received written notice of Rio Tinto."

He said iron ore has special properties, supply and demand sides need to establish long-term stable cooperative relationship, which is the formation of a number of years the consensus of the international iron ore trade. To this end, China Steel Association advocated that trade should be based on long-term contract iron ore mainly to the annual price as the trading price of the international public to the basic contract price as FOB.

"Commitment to the three major mining companies in the past should be honored and fulfilled." Luo said, including the Rio Tinto mining company, including three in the past with Chinese steel companies and have actually made a commitment to the China Steel Association: they stressed the need for the rules of the international iron ore trade, their leaders repeatedly stressed that do not do spot mine.

Chinese Iron Ore Negotiations In The Second Round Did Not Price The Bottom Line

By: dpdo

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