Deadlocked talks between China's largest steel firm and the globe's biggest suppliers of iron ore will restart next week without any interference from Beijing, state press reported March 23. The talks on the price of iron ore contracts for the next 12 months will start on March 27, Xinhua news agency said, as negotiators race to beat an April 1 deadline.
Baosteel, which is leading the discussions for all Chinese firms, is trying to secure the cheapest possible price from the world's three largest exporters -- Australia's Rio Tinto, Anglo-Australian miner BHP Billiton and Brazil's Companhia Vale do Rio Doc. The talks have broken down amid much acrimony with China insisting it will not tolerate a repeat of last year's arrangement in which Chinese firms agreed to a 71.5% hike in the price of the commodity.
China wants to keep this year's price rise limited to around 10% but mining groups want a sharper rise of up to 30%, analysts have said.
China is taking a more conciliatory note on March 23 than it had last week when it said it was prepared to intervene in the talks to ensure a fairer price. "The Chinese government continues to express great 'concern' for the process and outcome of the talks, but stands by its policy of not directly interfering in the negotiations," Xinhua quoted an unidentified official close to the discussions as saying.
Nevertheless, analysts have said measures could be taken outside the talks, such as denying permission for imports of iron ore above certain price ceilings.
China's price negotiations are important because they help in setting prices for the commodity around the world, although in the past it was Japan who played the leading role. With China's economy booming, the nation is expected to account for 45% of global imports of iron ore this year.
Copyright Agence France-Presse, 2006