Commerce ministry backs steel mills in iron ore negotiations

14:31, March 16, 2010      

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China's Ministry of Commerce (MOFCOM) hopes to maintain the current iron ore long co-pricing negotiation mechanism, and will provide support to Chinese steel mills when necessary, ministry spokesman Yao Jian said on March 16.

China is a major steel producer and the world's largest iron ore consumer. "China should play an important role in the iron ore-pricing mechanism, and China's interests should be represented in the negotiations," he said.

He also noted that the ministry hopes that iron ore suppliers and steel mills worldwide join hands in maintaining the long contract pricing mechanism, in order to avoid violent fluctuations of iron ore prices.

"The MOFCOM will provide support to the China Iron and Steel Association (CISA) and Chinese steel producers, including means of trade policies."

Yao, however, didn't disclose what kind of policies will be adopted to support the steel producers.

The three iron ore giants, namely BHP Billiton, Rio Tinto and Vale, are demanding a price hike of 80 to 90 percent, far beyond Chinese steel producers' expectations.

By People's Daily Online
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