Although the 2009 iron ore talks aren't finished yet, the balance is obviously tilting to China's steelmakers. Market players hold an optimistic sentiment on the result of iron ore talks with the highest expectation a decrease in price of over 50%.
Most people think the lower the imported iron ore price is the better it will be. However, Mr Han Weidong marketing manager of Hebei Steel Group feels that if iron ore price is pressed too much, it will severely narrow the living room for domestic miners.
Mr Han said "Despite miners that rely on large mills, most medium and small sized miners have been struggling for a living. If those mines are bankrupted by lower import prices, China mills will depend more on overseas miners which will seed a hidden peril for iron ore negotiation in future.”
However, Mr Han Weidong warned that too low an import price may sharply drive domestic miners to an impasse, as present home-produced iron ore has already held a lack of competitiveness in the market due to plunging imported resources.
Source: Xinhua/Steel Guru
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