What Factors Affect the Price of Iron Ore?

The three iron ore giants refer to the three iron ore production, development, and marketing groups of Brazil's Vale, Brazil's BHP Billiton and Rio Tinto. The cold current in the steel market drove the iron ore prices, which have been rising since 2002, to plummet. The China Iron and Steel Association and steel companies aspiring to make a comeback in the 2009 international iron ore negotiations have stated that iron ore prices should be reduced. However, the bottom line was touched by the three iron ore giants, and the negotiations were deadlocked, so that the spot ore of the three giants could not be bought.

Big Three Iron Ore

Iron Ore Big Three Advice

The issue of iron ore negotiations is no longer a simple economic event. It must be considered at the height of political and national economic security.

1. Coordinate the production of the steel industry and the scale of steel exports. The whole industry reduced production, large steel plants reduced production by 1/3, small and medium steel plants reduced production by 1/2; the scale of exports fell by half.

2. All the hoarding iron ore in China will be temporarily received by the state, and the domestic steel mills will be supplied in a coordinated manner under the rationing system. All steel mills must work together to overcome difficulties. The state subsidizes domestic miners to increase the scale of ore production, and all ore produced should be supplied to domestic steel mills.

3. Investigate Liang Tuo s suspected commercial crimes in China, and temporarily freeze all of its assets in China on the grounds that it is suspected of improper business activities.

4. Adjust the scale of coke exports to one-fourth of the current level, and stop supply to Japan and South Korea as a punishment for negotiating actions that harm China's interests.

5. Carry out antitrust review of the three major iron ore suppliers. If it is determined by law that there is a monopoly, they should issue sky-high fines.

6. The state supports a number of private companies to acquire Rio Tinto shares in the Australian stock market, seize control of Rio Tinto, re-select its board of directors, and control Rio Tinto and split the alliance.

Expert analysis of the three iron ore giants

The three giants' spot ore cannot be said to have stopped, but they have indeed decreased significantly. The main reason for the reduction in supply is that as the economic situation improves, Japan and South Korea s European and American steel production capacity has begun to release, and the demand for iron ore has increased. Changxie mine supply, the remaining can be used to sell the spot. " This is why China needs to set a long-term association mine as soon as possible. An iron and steel analyst believes that China accepts the starting price, but the possibility of adopting a half-year pricing model is very high. "But there are too many unexpected things, so the result may be delayed for some time before it can be announced." At present, most steel companies have begun to buy Changxie mines at a discount of 6.7% based on the 2008 Changxie mine prices based on the three giants (Rio Tinto, BHP Billiton and Vale). And this "temporary price" will be settled in accordance with the rules of returning and supplementing after the official introduction of China Changxie mine prices.