China'S Iron Ore Price Index Debut In October

In September 20th, the China Iron and Steel Industry Association, jointly with the China Minmetals Import and Export Chamber of Commerce and the China Metallurgical Mining Enterprise Association, formally launched the Chinese iron ore price index.

The index will be released from October this week.

Zhou Wangjun, deputy director of the price department of the national development and Reform Commission, pointed out that the establishment of the iron ore price index will help to guide the formation of the expected price of iron ore at home and abroad, guide the production and development of steel enterprises and reduce costs, and help to break the monopoly of international iron ore giants.

Although the world's largest steel producer, China's bargaining power on iron ore raw materials for iron and steel production is very weak, and pricing power has long been in the hands of the three major mining giants.

At present, the price of iron ore has shifted from the long association pricing to the indexed pricing, and the price index of iron ore that can reflect the actual production demand of our country is more urgent.

It is understood that the launch of the Chinese iron ore price index (CIOPI), composed of the "domestic iron ore price index" and "imported iron ore price index" two sub index, are based on the April 1994 price basis, that is, 100 points.

Among them, the domestic iron ore price index data collection for the main production areas of the country's iron concentrate market paction tax price, the imported iron ore price index data collection scope for the member units submitted dry basis powder mine CIF.

Considering the comparability of domestic and imported mineral prices, domestic iron concentrate and imported iron ore are converted to 62% of iron grade.

On the sample selection, the domestic iron ore price index samples were collected covering the main iron ore producing areas in the country. The output in 2010 accounted for 93% of the total iron ore output in the country. The imported iron ore price index samples were collected on the basis of the quantity of imported iron ore and the CIF price submitted by the member enterprises of the iron and Steel Association and the China Minmetals Import and Export Chamber of Commerce. The coverage of the sample collection has reached more than 95% of the import volume.

Zhu Jimin, President of the China Iron and Steel Association, said that since August, China's iron ore price index has been put into operation, and the overall situation is good. The data collection system is running normally, and the index is in line with the market trend.

From October onwards, China's iron ore price index will be released according to the week.

Zhu Jimin pointed out that in recent years, China's steel output has increased rapidly, and its dependence on imported iron ore resources has been rising. Iron ore prices have continued to rise sharply, which has become a major factor affecting the economic efficiency of the steel industry.

The release of China's iron ore price index, reflecting the price changes of iron ore market scientifically and reasonably, will help to promote effective competition among resource enterprises and guide the healthy development of iron and steel industry.

Guiding price

Since the crude steel output exceeded 1 billion tons in 1996, to 2010, China has ranked first in world steel production for more than 10 consecutive years, and its share of global steel output has increased from 13.5% in 1996 to 44.3% in 2010.

With the rapid growth of production, the demand for iron ore has also increased rapidly, and the dependence on imported iron ore has been increasing. In 2010, the consumption of iron ore in China accounted for about 63% of domestic consumption.

In recent years, the price of iron ore has been rising sharply, which has become the most important factor to squeeze the economic benefits of the iron and steel industry.

According to Sinosteel data, in the first 8 months of this year, China imported a total of 4.48 million tons of iron ore, an increase of 10.6% over the same period last year, and the average price of imported iron ore was 164.36 US dollars / ton, an increase of 37.5% over the same period last year.

The cost of foreign iron ore increased by more than 20 billion 50 million US dollars, and the cost of the iron and steel industry increased by nearly 130 billion yuan.

Affected by this, domestic large and medium iron and steel enterprises sales profit margin is only about 3%, iron and steel enterprises cost pressure is increasing.

"The introduction of iron ore price index is not to directly intervene in the economy, but through the release of index to guide and regulate the market."

Zhou Wangjun pointed out that the price index reflects the links of production, consumption and circulation.

The establishment of the iron ore price index will help to guide the formation of the expected price of iron ore at home and abroad, guide the production and development of steel enterprises and reduce costs, and also help break the international iron ore giant's monopoly of the market.

We must strive to make the price index go to the world and compete for the international market.