Price for imported iron ore doubles
The average price for iron ore imported via the major Chinese port Ningbo has almost doubled in the first four months, according to local customs.
The imports through the port increased by about 15 percent in the first four months, exceeding 10 million tons, according to statistics from the customs. The total iron imports in the period valued at US$579 million, up by an unproportionate 124 percent and indicating a soar in iron ore price.
According to the customs, the average price for imported iron ore skyrocketed to US$56.26 per ton during the period, up by over 95 percent.
Ningbo is one of the largest Chinese ports in terms of iron ore imports. China has become the world's No 1 importer of iron ore and its total imports in 2004 hit 140 million tons. China's huge demand has made the international iron ore market booming and prices surging.
Iron ore imported through the Ningbo Port, in East China's Zhejiang Province, comes mainly from Brazil, Australia and South Africa.
Experts suggest Chinese iron and steel companies take measures in four aspects to cope with challenges brought about by price hikes. Firstly, a joint procurement will increase buying volume and also increase a consortium's bargaining power.
Secondly, buying stocks of overseas iron mines will help companies be less likely to suffer price fluctuation or supply shortage. Thirdly, companies should build stable domestic supply bases. And finally steel makers should limit their production capacity to within a moderate level to avoid too fast expansion in the industry.