Chinese Mandarin - Gov't: China can't pay more for iron ore

CHINA / index

Gov't: China can't pay more for iron ore
by AP
Updated: 2006-03-18 08:52

BEIJING - China's government won't interfere in price talks between its
steel makers and foreign iron ore suppliers, a Cabinet minister said
Friday, though the government insisted it can't afford another jump in
already high prices.

The comments by Ma Kai, the minister in charge of China's main planning
agency, came after suppliers expressed alarm at suggestions the world's
top steel producer might try to dictate prices following a 71.5 percent
rise in iron ore costs over the past year.

"The government will not interfere in setting the price, and the price
will be decided by the market," Ma told a visiting group of U.S.
newspaper editors.

Ma said, however, that China plans to restrain the growth of its steel
industry this year in order to conserve energy and water and cut demand
for costly imported raw materials.

China's iron ore imports from Australia, Brazil and other producers rose
37 percent last year amid high demand by its booming automaking,
construction and other industries.

Chinese steel makers are in talks with suppliers BHP Billiton Ltd. and
Rio Tinto Group of Australia and Brazil's Companhia Vale do Rio Doce over
the price of long-term contracts. The suppliers reportedly want price
increases of 15 to 20 percent, to take effect April 1.

Ma's agency, the National Development and Reform Commission, and the
Commerce Ministry issued a statement this week expressing dismay at
rising iron ore prices and calling them unacceptable.

"The government will pay close attention to iron ore price talks and take
necessary measures if prices are unacceptable and unreasonable," the
statement said.

Last year's jump in iron ore prices prompted complaints over China's
apparent lack of bargaining power, even though it imported 275 million
tons last year, or about 43 percent of world production.

"This is the first step by China to limit commodity prices. We believe
China will likely develop a comprehensive strategy to deal with commodity
prices," Andy Xie, an economist at Morgan Stanley in Hong Kong wrote in a
report released Thursday.

Page: 1 2

Most Commented/Read Stories in 48 Hours

Today's Top News 

� Coal output set to reach record high of 2.5b tons

� EU likely to impose tax on imports of Chinese shoes

� Bankers confident about future growth

� Gov't: China can't pay more for iron ore

� US senators to visit China to talk trade

Top China News 

� Most of urban Chinese like Americans - survey

� Billionaire executed for contract murder

� China offers compromise on Iran talks at UN

� Curtain to be raised on Year of Russia

� Bankers confident about future growth

Learn Chinese, Learn Mandarin online, Learning Materials, Mandarin audio lessons, Chinese writing lessons, Chinese vocabulary lists, About chinese characters, News in Chinese, Go to China, Travel to China, Study in China, Teach in China, Dictionaries, Learn Chinese Painting, Your name in Chinese, Chinese calligraphy, Chinese songs, Chinese proverbs, Chinese poetry, Chinese tattoo, Beijing 2008 Olympics, Mandarin Phrasebook, Chinese editor, Pinyin editor, China Travel, Travel to Beijing, Travel to Tibet