Iron ore price still not agreed
By Jiang Wei (China Daily)
Updated: 2006-05-23 09:14
Chinese major steel mills will continue to push for a better pricing deal
although some Asian mills have accepted a 19 per cent rise in 2006 long-term
iron ore prices.
"Chinese firms will not agree on iron ore prices without
considering the market," the China Iron and Steel Association said on its
website after 16 major Chinese mills met in Beijing.
The statement came
after Australian miner Rio Tinto Ltd Plc announced that some Japanese steel
firms had agreed on a 19 per cent rise in 2006 long-term prices. The company did
not disclose which companies they were.
CVRD, the world's top iron ore
supplier, also said South Korea's POSCO CO Ltd had agreed on the price rise. The
association said steel prices in the European market are reaching very high
levels but prices in Asia, particularly in China, are about 20 per cent lower
than last year's peak.
It said any price hike should not be regarded as a
global benchmark if it was not reached with the three major buyers, China's
Baosteel, Japan's Nippon Steel Corp and Europe's Arcelor
SA.
Traditionally, the first price agreed by a major supplier and a major
importer forms a benchmark that is followed by others.
This year's iron
ore price talks, headed by China's largest steel makers Baosteel, are still
ongoing, the association said.
The Chinese industry opposed some miners'
behaviour to pressure Chinese firms to accept the rise by linking iron ore
supply contracts with coal supply contracts.
China accounts for over 40 per
cent of global iron ore shipment and over 70 per cent of Asia's
imports.
Chinese mills last year accepted a 75 per cent increase in iron
ore prices, which were first agreed by Nippon Steel Corp.
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