By | 2008-03-08 00:00:00

Driven by surging freight costs, imported iron ore prices may rise, China's industry representative hinted ahead of annual price negotiations scheduled to take place next month. Xu Lejiang, chairman of Baoshan Iron & Steel Corp (Baosteel Group), said on Friday that iron ore prices should remain stable, but added that recent rises in freight costs had sparked concerns that import prices may be affected. "The freight cost hikes have made iron ore exporters complain a lot and we have already been aware of that," said Xu, a delegate to the ongoing 17th National Congress of the Communist Party of China. Xu, whose company is China's biggest steel producer, said this new factor should be taken into account when Baosteel Group, representing China's 16 major steel giants, goes into talks on iron ore prices for 2008 next month with the world's top three suppliers - CVRD, BHP Billiton and Rio Tinto. Following a 19 percent increase last year and a 71.5 percent surge in 2005, the top three suppliers, who control three-quarters of the global iron ore trade, upped prices by 9.5 percent last year. China's iron ore imports grew 19 percent year-on-year to 222 million tons in the first seven months of this year, according to official statistics. Xu said China, the world's biggest steel producer, will be importing more iron ore from other countries while it continues to expand its mining activities in China. "Instead of only benefiting China, our imports can generate revenues for the exporting countries," said Xu. He said that Australia, Brazil and some Asian countries should become China's major iron ore suppliers. Xu said Baosteel Group has already exceeded last year's full-year profit in the first nine months of this year, driven by demand from automakers, shipbuilders and construction companies. The Shanghai-based company had a profit of 29 billion yuan in the nine months ending on September 30, compared with earnings of 22.3 billion yuan in 2006. "All the latest progress has laid solid foundations for further mergers and acquisitions both at home and abroad," said Xu. Standard & Poor's gave the company one of the best credit ratings in the world this month, awarding Baosteel an A-, up from a BBB+, one of only two global steel companies - South Korea's steel giant POSCO is the other - with that rating. Baosteel took over Xinjiang Bayi Iron & Steel Group this year, its first acquisition of a mill since it was formed in 1998. With first-phase investment of US$3 billion, Baosteel has launched its first overseas project in Brazil. "We plan to invest or launch more projects in other resource-rich countries," said Xu. Xu also said his group has long thought of listed on overseas stock markets. "That should be part of our strategy to build up international competitiveness."

By | 2008-03-08 00:00:00

It is unwise to invest more in the stainless steel industry, said Wu Jianchang, deputy chairman of the China Iron and Steel Association, the Beijing Business Today reported. China's total stainless steel production capacity has surpassed current demand, a situation which will extend into the future, said Wu yesterday at the 5th China International Stainless Steel Congress in Shanghai. As a result, he suggested the country boost efforts to stimulate stainless steel consumption and especially domestic consumption, but not to enlarge output at all. Statistics showed that China topped the world in terms of stainless steel output and apparent consumption last year. The four steel giants, Taiyuan Iron and Steel, BaoSteel, Zhang Pu Stainless Steel, and Lianzhong Stainless Steel, contributed 60 percent of the total 10 million tons stainless steel output capacity. In order to stoke domestic demand, Wu suggested improvements to people's daily civil stainless steel consumption and upgrades in the manufacturing industry, in areas such as electricity generation, electric power, petrochemicals, automobiles and shipbuilding. Meanwhile, the whole stainless steel industry urgently needs to eliminate outdated production capacity in facilities, particularly those with high consumption of raw materials, heavy pollution and low product quality.  

By | 2008-03-08 00:00:00

It is reported that Russia pipe import from China has increased sharply; therefore, Russia is planning to have import quota control on Chinese steel pipes. In the first 8 months of this year, Russia's trade deficit with China has reached USD 4 billion. This is the first trade deficit with China since last ten years. As the rapid trade amount between the two countries increases, this trade deficit gap will keep widening. The great amount of steel pipe from China is threatening the survive of Russia's relevant enterprise. The organization of Russia steel pipe industry development said that the total steel pipe import from china will be 8.5 times up more than last year. If China government does not place a curb on steel export to Russia, Russia will start anti dumping investigation and have quota control on the import of steel pipe from China soon.

By | 2008-03-08 00:00:00

Interfax China reported that Nanjing Iron & Steel Group is planning to build a 1.5 million tonne steel mill in the Indonesian province of South Kalimantan in 2008 with a total investment of roughly USD 500 million. Mr Anshari Bukhari director general for metal, machinery and textiles at the Indonesian department of industry said that the steel mill project, designed with a capacity to produce up to 1.5 million tonnes of billet and slab could see production capacity expanded to 2 million tons in the future. He added that Nanjing Steel wanted to team up with a local hot rolled coil manufacturer, Gunung Garuda Group, to ensure supply of the basic materials. Raw material for production including coal and iron ore will be predominantly sourced in Kalimantan and if needed, the project will also import iron ore from Australia. Mr Jia Liangqun an analyst with Mysteel told Interfax that "A trend is developing in which Chinese steel mills are establishing steelworks overseas, as China has become a net steel exporter. Chinese steel makers are looking for opportunities in growing economies, like India, Brazil and Indonesia, where they have abundant resources and increasing demand, whereas further expansion at home is relatively limited."

By | 2008-03-08 00:00:00

Interfax China citing Beijing based Custeel reported that Germany's two largest steel mills ThyssenKrupp AG and Salzgitter AG have raised the issue of AD sanctions against Chinese steel product exports at the International Iron and Steel Institute AGM held in Berlin on Monday. As per report, both ThyssenKrupp and Salzgitter have submitted a formal complaint to the European Commission in Brussels last weekend. According to an announcement on the Stahl-Zentrum website, an umbrella organization for the German steel industry, the German federal government supports AD measures against Chinese steel product exports and dispatched the federal minister for economic affairs Mr Michael Glos to the AGM in order to hurry the process along. However, European Union Industrial Commissioner Mr Gunter Verheugen commented that it is still unclear as to whether the European Commission will implement AD and CVD measures against China, as investigations have not yet been completed. According to a presentation given at the AGM by Mr Dieter Ameling, president of the German Steel Federation and chairman of the Steel Institute VDEh, a number of European steel producers are currently preparing anti-dumping cases against China. However, the use of trade sanctions is always a last resort when all political initiatives have been exhausted in order to protect EU industry against unfair trade practices. Mr Ameling also advised China that instead of exporting steel produced at the expense of the Chinese environment, they would do better to remove their uneconomical and heavily polluting capacities from the market in order to prevent the current dispute from becoming a long standing trade conflict. The EU is currently China's second most important export market after Asia, receiving approximately 17% of China's annual exports. China's steel product exports to the EU are set to double from last year to 10 million tonnes this year, after only having passed the 1 million tonne mark in 2005.

By | 2008-03-08 00:00:00

Interfax China citing Beijing based Custeel reported that Germany's two largest steel mills ThyssenKrupp AG and Salzgitter AG have raised the issue of AD sanctions against Chinese steel product exports at the International Iron and Steel Institute AGM held in Berlin on Monday. As per report, both ThyssenKrupp and Salzgitter have submitted a formal complaint to the European Commission in Brussels last weekend. According to an announcement on the Stahl-Zentrum website, an umbrella organization for the German steel industry, the German federal government supports AD measures against Chinese steel product exports and dispatched the federal minister for economic affairs Mr Michael Glos to the AGM in order to hurry the process along. However, European Union Industrial Commissioner Mr Gunter Verheugen commented that it is still unclear as to whether the European Commission will implement AD and CVD measures against China, as investigations have not yet been completed. According to a presentation given at the AGM by Mr Dieter Ameling, president of the German Steel Federation and chairman of the Steel Institute VDEh, a number of European steel producers are currently preparing anti-dumping cases against China. However, the use of trade sanctions is always a last resort when all political initiatives have been exhausted in order to protect EU industry against unfair trade practices. Mr Ameling also advised China that instead of exporting steel produced at the expense of the Chinese environment, they would do better to remove their uneconomical and heavily polluting capacities from the market in order to prevent the current dispute from becoming a long standing trade conflict. The EU is currently China's second most important export market after Asia, receiving approximately 17% of China's annual exports. China's steel product exports to the EU are set to double from last year to 10 million tonnes this year, after only having passed the 1 million tonne mark in 2005.

By | 2008-03-08 00:00:00

SHANGHAI: China's iron ore imports are expected to increase at a slower pace because of rising domestic supply and decline in the growth of steel output capacity, say industry insiders. The country's import of iron ore rose to 187.9 million tons in the first six months this year, up 16.46 percent year-on-year. Australia continues to be the biggest exporter to China, accounting for 37.95 percent of the country's total imports, followed by India, Brazil and South Africa. The output of large and medium-sized mines in China rose 29.28 percent to 321.28 million tons in the first half while the output of small mines was around 50 million tons. "The large scale of mining by domestic steel companies is expected to curb further rises in ore prices," said Chen Xianwen, an official from the China Iron & Steel Association (CISA) at the International Iron Ore Market Seminar in Shanghai yesterday. "The domestic demand for iron ore is expected to increase around 70 million tons this year. Apart from the domestic output growth, of around 40 to 45 million tons, we need only 30 million tons more from overseas, which rose only 9 percent from last year," said Zou Jian, chairman of the China Metallurgical Mining Enterprise Association, at the seminar. "Large drops are expected in steel prices in 2009 because of the projected slowdown of world economic growth." China's crude steel output rose only 14.64 percent in June, dropping 11.44 percentage points from January. "The output is expected to increase slower, which may lead to a shrinkage in iron ore demand," said Zou. However, mainland steelmakers continue to be under price pressure because of the soaring transportation cost of iron ore. "Transportation cost has become a key factor," said Liu Yongshun, director of APAC Resources Limited, who has been a Baosteel representative in iron ore negotiations in past years. The average CIF (cost, insurance and freight) prices rose 21.54 percent to $74.64 per ton in the first half of this year, much more than the rising pace of FOB (freight on board) prices. Chen Haoran, chairman of the China Chamber of Commerce of Metals, Minerals & Chemicals Importers & Exporters, said: "Besides some factors like monopoly of the iron ore market by the three largest producers, the rising ore price is just a reflection of the market need." Ore supply is expected to increase massively worldwide. Brazil's CVRD, the world's largest iron ore producer, is expected to produce 300 million tons of iron ore this year. RioTinto and BHP Billiton, two big exporters to China, are also expected to expand their capacity to 300 million tons in the years to come, according to the CISA's Chen.

By | 2008-03-08 00:00:00

SHANGHAI: China's iron ore imports are expected to increase at a slower pace because of rising domestic supply and decline in the growth of steel output capacity, say industry insiders. The country's import of iron ore rose to 187.9 million tons in the first six months this year, up 16.46 percent year-on-year. Australia continues to be the biggest exporter to China, accounting for 37.95 percent of the country's total imports, followed by India, Brazil and South Africa. The output of large and medium-sized mines in China rose 29.28 percent to 321.28 million tons in the first half while the output of small mines was around 50 million tons. "The large scale of mining by domestic steel companies is expected to curb further rises in ore prices," said Chen Xianwen, an official from the China Iron & Steel Association (CISA) at the International Iron Ore Market Seminar in Shanghai yesterday. "The domestic demand for iron ore is expected to increase around 70 million tons this year. Apart from the domestic output growth, of around 40 to 45 million tons, we need only 30 million tons more from overseas, which rose only 9 percent from last year," said Zou Jian, chairman of the China Metallurgical Mining Enterprise Association, at the seminar. "Large drops are expected in steel prices in 2009 because of the projected slowdown of world economic growth." China's crude steel output rose only 14.64 percent in June, dropping 11.44 percentage points from January. "The output is expected to increase slower, which may lead to a shrinkage in iron ore demand," said Zou. However, mainland steelmakers continue to be under price pressure because of the soaring transportation cost of iron ore. "Transportation cost has become a key factor," said Liu Yongshun, director of APAC Resources Limited, who has been a Baosteel representative in iron ore negotiations in past years. The average CIF (cost, insurance and freight) prices rose 21.54 percent to $74.64 per ton in the first half of this year, much more than the rising pace of FOB (freight on board) prices. Chen Haoran, chairman of the China Chamber of Commerce of Metals, Minerals & Chemicals Importers & Exporters, said: "Besides some factors like monopoly of the iron ore market by the three largest producers, the rising ore price is just a reflection of the market need." Ore supply is expected to increase massively worldwide. Brazil's CVRD, the world's largest iron ore producer, is expected to produce 300 million tons of iron ore this year. RioTinto and BHP Billiton, two big exporters to China, are also expected to expand their capacity to 300 million tons in the years to come, according to the CISA's Chen.

By | 2008-03-08 00:00:00

BEIJING, Sept. 7 (Xinhua) -- China closed down 18.4 million tons of outmoded iron and steel production capacity in the first half of the year in an effort to reduce energy consumption and greenhouse gas emissions, said the National Development and Reform Commission on Friday. The shutdown included 9.7 million tons of iron capacity and 8.7 million tons of steel capacity in Beijing and nine provinces such as Hebei, Shanxi, Shaanxi and Liaoning. The 10 major steel producing regions promised in April that 22.6 million tons of iron capacity and 24.2 million tons of steel capacity would be eliminated for the whole of 2007. China plans to phase out 100 million tons of out-of-date iron capacity and 55 million tons of steel capacity by 2010 as the country's steel makers consume too much energy and cause serious pollution. The plan is expected to save 50 million tons of coal equivalent and 100 million tons of water and reduce 400,000 tons of sulfur dioxide emissions annually. Last year, China maintained its position as the world's No. 1 steel producer for the 11th consecutive year. Its output, at 420 million tons, accounts for 34 percent of the world total. It is estimated that the country's steel output will reach 500 million tons this year.  

By | 2008-03-08 00:00:00

It's reported by Xinhua News Agency that the building materials produced in China has have been taken up 1/3 market share of UAE. However, it's possible of China's building materials would appear to be rising somewhat recently, which would cause certain influence to the market. The report said that the total amount of China's building materials used by UAE local construction in process has reached to about $300,000,000. But influenced by Chinese government's export rebate policy, freight rate increase etc. the price of Chinese building materials in UAE market will rise by 10% to 15%. Several days ago, China lowed the export rebate of such building materials as stone, pottery, glass from 11% to 5%. It's reported that this situation would lead to costs rising of enterprises and would be reflected in Middle East market. What's more, the rise of sea freight also pushes the rise of Chinese building materials' price. www.chinafastener.com