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Spot imports to make up 83 pct China ore imports-CISA

Published 08/04/2009, 09:02 PM
Updated 08/04/2009, 09:06 PM
BHPB
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BEIJING, Aug 5 (Reuters) - Spot imports will account for 83 percent of China's iron ore imports this year, the China Iron and Steel Association said in a half-year report, while decrying the "disorderly" market that it blames for rising prices.

Chinese mills have not yet settled on an annual price for term iron ore imports, meaning most is being imported on a spot or indexed basis.

Steel production soared in the first half of the year, while imports also rose as Chinese fixed-asset investment responded to a government stimulus package, said the report, issued on the website of the Ministry of Industry and Information Technology.

In the report, CISA reiterated its intent to limit imports to end-users or to trading companies that can prove they have already contracted an end-user, to fight "speculative" imports.

CISA took over as lead negotiator for the Chinese industry this year in annual price talks with Australian miners Rio Tinto, BHP Billiton and Brazil's Vale, but has failed to settle due to its insistence on wringing a better deal than the 33 percent drop negotiated by Japanese and South Korean mills.

Ore prices have risen substantially since the Japanese and South Korean settlement.

CISA is just "clinging to the feet of the Buddha," a Chinese steel analyst was cited as saying in an International Finance News article on the CISA report, using a Chinese idiom for desperately snatching any solution that presents itself.

(Reporting by Lucy Hornby; Editing by Ken Wills)

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