Iron ore exporters eye 8% price rise in China

Domestic iron ore producers are likely to get 5-8 per cent higher prices this year from China. However, the industry had expected the prices to be higher by 10 per cent.

"Officials from the China Chamber of Commerce of Metals, Minerals and Chemicals Importers and Exporters (CCCMC) and China Iron and Steel Association (CISA) are negotiating with Indian suppliers and the price may be up to eight per cent higher this year," an industry source said.

At present, the medium grade iron ore (with 58-62 per cent purity) is sold between $37 and $40 per tonne.

CCCMC and CISA are the representative bodies of Chinese ministry of steel. It is the responsibility of these bodies to negotiating iron ore prices with exporting countries.

"Several rounds of talks have taken place but a final decision has not been taken yet. However, I am confident that the prices will go up by at least eight per cent this year," an official with an iron ore export house said.

The negotiations are likely to be prolonged further as a consensus has not yet been arrived at, the official added.

Domestic iron ore prices are inching up slowly after two months of stagnation because inconclusive discussions. In January and February, the prices had slumped by Rs 250-300 due to poor demand from steel industry.

Indian iron ore exports had surged to 78 million tonne in 2004-05 after stagnating at 35 million tonne for about a decade. The country exports all varieties of iron ores to China and Japan.