The China Iron & Steel Association (CISA) has asked the Chinese government to supervise the increasing iron ore prices which ended at a seven year high last week.
According to media reports, Luo Tiejun, vice president at CISA, demanded an explanation for the drastic increase in iron ore pricing from Australian miner BHP in a video conference held last week regarding a $7.5/mt hike over a single day. The Australian miner then agreed to communicate with CISA in a open and transparent manner about iron ore prices.
The rising price of iron ore seems to be threatening the profitability of steel plants in China, where 90pc of their supply is purchased from other nations. In the first 11 months of the year, the country’s iron ore imports rose by 11pc to 1.07bn mt, wherein 60pc of imports were from Australia. Apart from BHP, China also imports iron ore from major suppliers like Vale, Rio Tinto and Fortescue.