The iron ore market is wavering again, India is raising the export tax

The ore market in the third quarter was again turbulent, the first wave, from the "backyard" of supply.
On July 5th, it was reported that Indian Steel Minister Virbhadra Singh had once again proposed to the Ministry of Finance that iron ore exports should be completely restricted or a 20% export tax should be uniformly imposed to ensure the raw material demand for the development of the Indian steel industry.
According to previously announced plans, Indian steel production capacity will increase from the current 72 million tons to 124 million tons by 2012. At present, the export tax rate of Indian fine ore is 5%.
Earlier, Li Xinchuang, president of the Metallurgical Industry Planning Institute, pointed out that "as the largest spot importer of iron ore in China, India's own development will inevitably drive the level of steel consumption. Whether its domestic ore supply capacity to China can continue is China's. Strategic issues that cannot be ignored for a long time."
Now, as India raises the iron ore export tax rate, the spot supply of Chinese steel companies is once again under pressure. At the same time, the current quarterly agreement model is being faltered by the steel mill's loss pressure.
"We are all buying stocks now, and still feel that it is difficult to survive. I don't know if the big steel mills can hold on to the agreement price. I personally judge that the possibility of default is still quite large." On July 5, a private steel in Tangshan The person in charge of the factory said.
According to the quarterly pricing model, the third quarter mine price is settled in the second quarter spot average price, which is higher than the current spot price of 15-30 US dollars / ton. The cost of pig iron, which relies on the agreement mine production, has been higher than the pure spot production of iron 370 yuan / ton.
This is quite similar to the situation during the financial crisis. At that time, the long association and the spot price also appeared serious upside down. Chinese steel companies were forced to postpone the long association and switch to spot purchases. The contract execution rate was less than 70%.
Faced with the current price upside down situation, although Xu Lejiang, chairman of Baosteel Group, clearly stated that it would not purchase spot, more steel companies chose to continue to wait and see.
A person in charge of a large state-owned trader believes: "If it is an inevitable trend in the eyes of miners, then what the steel mills have to do is to assess the most appropriate timing of default to achieve greater self-interest."
After all, Rio Tinto CEO Tom Albanese has already said that if steel companies now switch to lower spot prices, it may mark the end of the quarterly pricing system.

Curtain Accessories

Curtain Rail Clips,Crystal Curtain Holdback,Curtain Tieback

Bochuang Hardware Co., Ltd. ,