Shan Shang Hua: Never Said Ore To 82% Lower Prices
“When did I say the words? When talked ore prices to return to 1994? You do the media nonsense!” December 11, 2008 morning, China
Steel Industry Association, the Secretary-General Shan Shang Hua reporter’s telephone interview is still anger Nan Xiao.
Previous two days, a single is still said to be an interview with China to accept foreign reports, has provoked much discussion by international media. The report said Shang Hua Shan, said the current global steel prices have dropped to 1994 levels, CVRD, Rio Tinto and other international mining giants
Iron ore Contract prices should be reduced to 1994 levels, equivalent to 82% price reduction.
While the global financial crisis intensified
the occasion, a single such words is still China, “speech” naturally attracted people outside the steel industry wide attention, makes the Chinese steel companies such as BHP Billiton and the international iron ore giants 2009
Iron ore price Prospects for negotiations confusing. Shang Hua whitewash single Steel companies in China and BHP Billiton and other international iron ore price negotiations giants, the China Iron and Steel Industry Association will undoubtedly play an important role, as the association’s Secretary-General, one of China’s position still has a vital component.
11 morning, is still single-China meeting with reporters in a brief telephone interview, repeatedly stressed that he never said that iron ore prices to return to 1994 levels. “I say that steel prices have come down to 1994 prices, so ore (price) should be substantially decreased, as down to how much, to go through the two sides negotiated settlement.”
About the media coverage “is equivalent to 82% price reduction,” saying China is still one question: “When I said to drop 82%? What is 82%? 82% of which year?”
According to report, recently has begun to invite Chinese steel companies BHP Billiton to discuss the three major iron ore giants signed a supply agreement in 2009 iron ore, one is still China’s whitewash will help create a favorable atmosphere for negotiations.
Nevertheless, the “price cut” has become overburdened by the common voice of the Chinese iron and steel enterprises, it is an indisputable fact. “BHP Billiton three major iron ore giants in the Chinese market has been so profitable over now depressed global steel industry, iron ore prices should fall sharply.” Recent press interview, more than a steel company said.
Data show that since 2002, the year the global maritime supply iron ore price rise year by year. Newman ore powder of Australia, for example, in the 6 years between 2002-2008, the agreement price from 17.7 U.S. dollars / ton up to 91.9 U.S. dollars / ton, up 419.8 percent cumulative. Among them, 2005 and 2008, gains were as high as 71.5% and 79.88%.
According to Citibank’s information, in the period 2002-2007, three major suppliers of iron ore production of 130% of the average gross profit margin in 2006, up 173%, the lowest in 2003, but still reached 104% . Removal costs and currency appreciation factor, its profit is still considerable. At the same time, steel prices are far below the rate of iron ore prices. From fiscal 2002 to fiscal year 2008, 6 years, the global steel price index rose only an average of 178%. Domestic steel price index from December 2002 up 102 points to early January 2008 of 134 points, rose only 31.4%.
“Chinese steel enterprises for foreign iron ore giant, hard working, but profits into their pockets, this situation should not be allowed to continue.” Iron and steel enterprises in Jiangsu, one of a cadre.
“Down 50%, but hours not more than 30% down”
Fact, both the China Iron and Steel Industry Association, or iron and steel production enterprises require BHP Billiton and other international iron ore giants cut prices, is our common aspiration.
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