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China to launch iron ore price index on Oct. 1st

09-21-2011 10:52 BJT

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China is well-known to be the world's largest steel producer, but what is less known is that it lacks its own official price index for iron ore, the raw material used in steelmaking.

On October 1st, China will finally launch its own, meant to serve as a reference for the nation's massive steel industry.

The index is composed of two sub-indices: domestic iron ore prices and imported iron ore prices. The domestic index is based on the price of iron ore concentrates in 14 provinces, autonomous regions and municipalities as well as in 32 mining areas. The import index is collected based on data from eight ports around the world.

Zhu Jimin, chairman of China Iron & Steel Assoc. said, "Starting from October, the China Iron Ore Price Index will be published weekly. That is to say, every Monday, a price index of domestic iron ore and imported iron ore from last week will be released. It's English abbreviation is "CIOPI".

Coils of wire at a steel market in Shenyang, Liaoning province. Zhang Changfu,
vice-chairman of China Iron & Steel Association, said as the world's largest
iron ore consumer, the country needs a more transparent and fair price index.
[Photo / Reuters]

Insiders say the price of imported iron ore has soared in recent years, affecting the profitability of China's steel sector. In the first eight months of this year, the country paid an additional 20 billion US dollars for imports of iron ore. Steel makers say they need an authoritative price index to guide the domestic market.

Zhou Wangjun, deputy chief of Price Dep’t of NDRC said, "The index is helpful in guiding the formation of expected prices for both domestic and imported iron ore. It will also help to break the monopoly of global iron ore giants in the steel sector."

Experts say the launch of the China Iron Ore Price Index will reflect price changes more accurately and provide better information services for steel companies and trading enterprises.

On October 1st, China will finally launch its own, meant to serve
as a reference for the nation's massive steel industry.

Editor:Li Wanran |Source: CNTV.CN

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