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China to set national standard for imported iron ore

By Hu Yang (chinadaily.com.cn)
Updated: 2011-03-18 15:47

China is preparing to establish a national quality standard for imported iron ores, the Shanghai Securities News reported Friday, citing an industry expert with knowledge of the matter.

Luo Bingsheng, former executive vice chairman to the China Iron and Steel Association, said the standard will take into account factors such as water content and impurities, and substandard iron ores will not be imported.

Luo also said the steel industry will implement an agent policy within this year to regulate the iron ore import market. Under the policy, agents import iron ores and sell them to steel mills for commission fees.

China's steel mills have been struggling to make a profit since costs began rising, especially for iron ore.

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Market experts speculate that iron ore prices may fall in the near future, because the earthquake and following tsunami that hit Japan on March 11 may result in less demand from Japan.

But Zhu Kai, global sales director of Brazil's mining giant Vale, said that no Japanese steel mill has cancelled an order so far, and Vale's sales to Japan may not be affected, according to the newspaper.

Japan imports 100 million tons of iron ore each year, and about 31 million tons are sold by Vale, Zhu said.

"The impact on Japanese steelmakers has been limited, despite the magnitude of the natural events, and most of them have resumed operations," Vale said in a statement today, according to Bloomberg.