China Steel Association: Sino-Australian iron ore price negotiations are still quite difficult
The new long-term agreement price of iron ore a year from April 1st started, but the Chinese steel makers in Australia Rio Tinto (RioTinto) and BHP Billiton (BHP) is still not the result of negotiations.
March 31, executive vice president of China Steel Industry Association, Luo reporter's interview with producers of iron ore, called "Return to the main iron ore trade, both supply and demand continuing to build long term stable cooperative relationship", but he also admitted that negotiations "still very difficult."
In accordance with international practice, each year on April 1 will implement the new long-term iron ore price agreement. If you will not reach a new long-term iron ore price agreement, the price automatically run for three months last year, so the price negotiated later "Duotuishaobu"; If after three months the price has not Tan Long, will automatically terminate the contract.
Previously, the Brazilian iron ore producer Vale do Rio Doce (Vale) has an agreement of all the major steel producers, iron ore benchmark price of long-term contract rate of increase of 65% -71%. Luo said that Australia could implement here. However, Rio Tinto and BHP Billiton have been seeking a higher price increases.
At present, China imports iron ore, the proportion of long-term shipping contracts, only 30%, the proportion of high spot shipping contracts, is considered the basic iron ore prices. Therefore, China is most concerned about long-term iron ore price agreement system is broken, then the Chinese manufacturers only go to a higher spot market prices to buy mine. Luo expressed for many years to prove the formation mechanism of the price negotiation is not only the demand side, on the supply side is also the best interests of the iron ore is a kind of special nature, the bulk of the special commodity, mine can only sell the steel plant, steel plant can only be bought mine, and if both sides do not establish a cooperative relationship, ultimately detrimental to both supply and demand.
He mine as an example of India. FOB mine last year in India rose only 3%, or a small, but India is the highest ore CIF price, why? The average Indian ore to Chinese ports for long-distance freight is 2.1 times the Australian mine. The result is benefit shipping companies, China's steel industry to bear the great loss, is detrimental to the Indian mines. "Indian ore was of poor quality, the price is also highest in 2010, relations between iron ore supply will be reversed, to the mine when India will be the first to be eliminated out of." Luo said, "That will not win is a lose-lose."
It is understood that, in 2007 CVRD, BH P, the three major mining company Rio Tinto chief integrated implementation of the contract agreement rate was 92.53 percent. "If a mining company on the one hand stressed the Force Majeure, inadequate resources, the implementation rate of decline in the contract; the same time there are rich resources for the spot market, which is a credit enterprise should not be done." Luo said that if the iron ore supply-side there is not shipping, not enforce or even tear up the contract situation, we should bear the legal risk.
The Shanghai Futures Exchange futures market is accelerating preparations for steel, iron ore prices Luo that is conducive to stability, and external conditions are ripe, the specific launch date will be "not too far."
Luo also reminded the trend of steel prices this year "can not be blindly optimistic." 1,2-sized steel enterprises month profit rose 26%, generally higher than the national industry. "But basically next to the domestic market where supply and demand," Luo said that once a substantial decline in exports, total domestic production further if the blind raise, if supply exceeds demand prices will fall, "the current high steel prices have been adjusted in a state of . "
We are high quality suppliers, our products such as Marble texture , Tile texture manufacturer for oversee buyer. To know more, please visits china decorative wall panel.
Processing your request, Please wait....
