subject: Frbiz Reports China Broke Three Mines Last Line Of Defense Plan [print this page] "Now do not need to line up, can ship to the discharge." Tianjin port not far from a staff member pointed to the port said. Traditionally, iron ore imports in April should be a very busy time, but now the port is a deserted scene.
With the reduction in inbound cargo, imports become more sought-after ore, prices soared to a record high. According to my statistics show that the steel mesh, April 17 among China's imports of iron ore offer, 65% grade ore prices have soared in Brazil powder to 182 U.S. dollars / ton, Australia, 62% lump ore up to 185 U.S. dollars / ton, while 62% fine ore has reached 180 U.S. dollars / ton. Some of the high grade ore import prices rose in mid-March than 30%.
"Despite the offer, but not buy." One trader told reporters, because mine is not to delivery, they can only watch helplessly in the spot price rising anxious.
"On the one hand can not buy, for another, the price is too high, a large number of steel mills did not dare to buy." Above that to ensure the supply, some steel mills rely on ore deposits in Hong Kong to maintain. According to statistics, 67.93 million tons of ore deposits in Hong Kong this week, to reduce 690,000 tons from last week, Hong Kong and reduced survival in stage.
It is noteworthy that the current offer of 63 grade ore in India has reached 190 to 195 U.S. dollars per tonne, the price has exceeded the highest point of the first half of 2008.
In steel mills in "of the necessary fuel" dilemma when one of the three mines BHP Billiton chief commercial officer Kombo suddenly appeared in China. According to media reports, BHP Billiton executives in a meeting with 14 related to head China Steel Association, Kombo Billiton made a number of conditions, the responsible person in Steel Association, "there are some new ideas, some old ideas." It is understood that on March 30, BHP Billiton has issued a formal notice, announced it has many of its Asian customers to CIF, more short-term iron ore contract price agreement was reached to replace the annual price of the contract.
One industry sources, the implementation of flexible pricing and price index of iron ore, BHP Billiton firm abnormal attitude, and is to communicate with Chinese customers. Reporters from the national office of a large steel insiders know, Kombo and his party also visited Rio several domestic steel mill customers.
In such a sensitive period, BHP Billiton visit to China, continued tight supply situation will undoubtedly become an important bargaining chip in hand. The steel insiders admitted to reporters, steel for BHP Billiton's visit have become very enthusiastic support in order to obtain a stable supply, steel mills and mines are also efforts to maintain a good relationship between the number of steel had to BHP Billiton by quarterly pricing requirements expressed "full understanding" approach.
"Surely means quarterly pricing risk, and the current account down steel prices have been at a loss, but we are also hoping to have a steady supply of ore." The person says with frustration.
"Bargaining model has changed." My Network Consulting Director Xu Xiangchun steel in an interview that the three mines are no longer as before, just and Baosteel negotiators like to discuss the price, but with "one by one break" approach to the implementation of iron ore index of each customer.
This means that, in the flexible pricing of large condition, the customer other than in a long association, the three mines can also meet the requirements of new customers to accept, it is to tell the customer agreement before the long, Jishitamen not agree quarter price, the three ore mines still Buchou Mai.
On the other hand, continued tight supply of the three mines, man-made pulled the spot market price, but also to the steel mills has caused tremendous psychological pressure. Because of pricing flexibility means that the spot price will be an important reference, the spot ore prices represent the asking price for mine, one day later signed the contract may cost more, eager to stabilize the steel supply of raw materials more easily compromised.
Xu Xiangchun that can be expected that long-term iron ore supply agreement, the annual price negotiation mechanism is the verge of collapse. High raw material prices, market demand is not yet clear, serious excess capacity ... ... the late Chinese steel industry will face huge risks.
