China's Shagang may hold off its iron ore purchase from big three miners
Mr. Shen Wenming, the Vice President of Jiangsu based Shagang, the largest private steel enterprise in China said the firm may hold off its iron ore purchases from the big three miners and the steel output should be cut in consideration of the current weak steel market.
He added that the company has held discussions with the top three iron ore makers on unreasonable quarterly pricing as it always lags behind the market when the market dips but it increases faster than actual demand when the market turns up.
Also, it's heard that roughly 60% of Shagang iron ore contracts are based on quarterly pricing.
Shagang currently produced 29 million tons of iron, 35 million tons of steel and 33 million tons of rolled products annually.
News Date 19 Oct 2011 13:21:00 reported by Mike Lo