China's decrease in demand for iron ore forces leading foreign producers to back down on prices

08:49, October 15, 2010      

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China's downward demand for overseas iron ore is likely to be the major reason for the world's three leading iron ore miners, Rio Tinto, BHP Billiton Group and Vale SA, making their first price reduction in 2010 (10 percent), disclosed Chinese steel enterprises Wednesday.

According to the data from China's General Administration of Customs, in the first three quarters of the year, China cut its import volume by 460 million tons, a decrease of 2.5 percent compared with the same period of last year.

Reason for such reduction lies on the country's steel market, which operates now in slower speed, and governmental policies on energy saving and emission reduction, said an industry analyst.

In addition, to shake off its huge dependence on the ever costlier foreign steel, Chinese enterprises have increased their iron ore self-sufficiency, which weighs heavily on demand. To cite an example, Wuhan Iron and Steel claims that in five years, it will be self-sufficient in iron ore production.

However, the three-giant-monopolized industry is unlikely to be affected by the price slit.

Source: Global Times

(Editor:黄蓓蓓)

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