According to Luo Bingsheng, executive vice president of the association, China Iron and Steel Association (CISA) will push forward the iron ore import registration system, as an effort to curb the flow of imported iron ores to high polluting enterprises with backward production capacity.

The association’s latest data show that China imported 297 million tons of iron ores during the first half of 2009, up 29.3 percent from a year earlier. Those imported by trading companies reached 131 million tons, accounting for 43.96 percent of the total iron ore imports, higher than 29.83 percent during the first half of 2008.

China has 112 companies qualified for importing iron ores, but actually 152 companies were engaged in such business, according to the association.

According to statistics released by the National Bureau of Statistics, iron ores used in pig iron production increased 21.55 million tons during the year’s first half, while iron ore imports rose by 67.33 million tons. Obviously, the imports were highly above production demand, which led to large iron ore inventory in ports and high demurrage charges and ocean freight.

The large iron ore imports by trading companies has resulted in over imports and distorted the relationship between domestic iron ore supply and demand, and it was disturbing for the on-going iron ore price negotiation.

Luo said that China would strictly implement the iron ore import agency system. At the same time, it would adopt a uniform price in accordance with the negotiation results, to avoid the risk of speculation on different prices for one product.

Luo called on the government to encourage domestic iron ore exploitation, to ensure supply to the domestic market.

As for the highly concerned iron ore price negotiation, Luo said that it was still in progress.

Companhia Vale do Rio Doce, Brazil’s leading metals and mining company, said last Friday that it would not reach any price agreement with China before completion of price negotiation between China and Australia’s BHP Billiton Ltd. and Rio Tinto.

It is announced from BHP Billiton last week that it has reached an annual contract price with clients on 23 percent of its iron ores and a mixed contract price on 30 percent of its iron ores, leaving the rest 47 percent still under price negotiation.

It is reported on Monday that a Chinese senior official defended Beijing’s handling of the industrial spying case against an Australian executive for mining giant Rio Tinto, and urged Australia to respect China’s court processes.

Liu Jieyu, the deputy director of the Foreign Ministry’s international department, said the alleged actions of Chinese-born Australian Stern Hu would have been illegal in Australia too, and that critics should wait for the facts to come to light.

Hu, who heads mining giant Rio Tinto’s Chinese iron ore business, was detained with three Chinese co-workers in Shanghai on July 5 during contentious iron ore price talks. State media say they are accused of bribing Chinese steel company employees to get information on China’s negotiating stance.

Few other details have been made public, and the case has become politically charged. Australian government complaints that it is not getting enough direct information on the case from Beijing have fueled fears that Hu may not get a fair trial.

“The facts of the case would constitute a violation of Australian laws were the facts (to) happen here in Australia,” Liu told the Australian Broadcasting Corp. in an interview aired Monday. Liu, who gave the interview during a visit to Australia, did not offer any further details.

“We are dealing with a violation of the Chinese law and in all legal proceedings in different countries there are different provisions about what can be released at what point of time,” he said. “It is not up to me … to say what the law requires and what the law permits.”

He said Beijing expected foreign countries to respect China’s judicial system, adding that “the Chinese government respects the independence of the Australian judicial system, I think we would expect the same from other countries.”

At last, it is said that by dealing with this case, we are really establishing or we are really trying to establish a good environment for all companies in China – foreign companies operating in China and local Chinese companies.

It is determined that CHINA wants all of the country’s steel makers to accept a single ore import price once the price for this year.

The measure aims to regulate excess iron ore imports by small steel makers and intermediary traders, which have hampered ore negotiations by creating unnecessary demand.

The China Iron and Steel Association has proposed an import system to force traders and mills to buy ore at a unified benchmark price agreed with foreign miners, and traders could charge a 3-to-5-percent fee for resale, Luo Bingsheng, vice chairman of the CISA, said yesterday.

The steel industry group said foreign miners are encouraging spot sales to China, leading to excess imports and distorting China’s actual demand. Spot imports account for 83 percent of China’s ore purchase so far this year, it said. The country’s iron ore imports surged 29 percent in the first half, mainly driven by speculative buying from smaller mills and trading companies in recent months.

China’s negotiation position has been hurt by rising spot ore prices, which were below contract prices in May when Japan first accepted the 33-percent cut but have now exceeded them.

The CISA also expects a “reasonable” solution in the protracted iron ore price negotiations with global miners while it blamed speculative trading for hindering the talks.

“We hope to see a reasonable result,” Luo said at a press briefing yesterday in Beijing, adding China is seeking a win-win agreement.

The CISA, China’s lead negotiator this year, is locked in the talks as it demands a deeper cut in term prices after major Japanese and South Korean steel mills accepted a 33-percent reduction offered by Australia’s Rio Tinto, the world’s second-largest iron ore miner.

The talks, originally meant to set prices for the year starting April, had missed a key June 30 deadline, with some Chinese mills already agreeing to a temporary 33-percent cut.

BHP Billiton, the world’s No. 3 ore producer, this week said it has agreed to sell 30 percent of its volume for this year on a combination of quarterly negotiated pricing, spot market and index-based pricing, but only settled 23 percent of volume at annual contract prices.

It is reported on Monday that Chinese steel mills’ profit in July is expected to exceed 20 billion yuan (2.93 billion U.S. dollars), as the monthly growth of steel prices rose to an eight-year high.

Steel prices jumped in July, prompting profit in steel enterprises to expand, according to Xu Xiangchun, chief analyst with industry information provider MySteel.com.

The benchmark index of MySteel.com. for domestic steel prices rose 11.9 percent in the month.

Net profits in hot-rolled coil and cold-rolled coil are estimated to stand at 600 yuan and 1,400 yuan per tonne, as their prices gained by 376 yuan and 473 yuan per tonne in July, respectively, said Xu.

Full-year profit of China’s steel makers will reach 100 billion yuan if steel price remains stable in the second half, said Xu.

A revival in demand and the government’s continuous economic stimulus will help stabilize the steel prices, said Qi Xiangdong, vice secretary-general of the China Iron and Steel Association (CISA).

Profit in China’s 71 major steel enterprises totalled 3.55 billion yuan in June, expanding from May when they turned profitable after seven-month losses.

According to the CISA, The aggregate net profit of China’s major steel producers fell 43 percent to 84.6 billion yuan last year on weak demand amid the global financial crises.

It is reported that China Iron & Steel Association (CISA) Tuesday denied media reports that it had decided to suspend price negotiations with Australian iron ore giants Rio Tinto and BHP Billiton. It said speculative behaviour in the spot market had led to high price rises, forcing it to suspend the negotiations with Australia’s Rio Tinto and BHP Billiton.

Media reports said Monday that CISA decided to temporarily suspend the on-going iron ore price talks to evade unreasonable interruptions from the spot market where iron ore prices have been distorted.

But CISA refuted the above reports, saying that it never released such a statement and that its talks with Rio Tinto and BHP Billiton are underway.

Xu Zhongbo, a professor of the University of Science & Technology Beijing, noted that the iron ore price talks going on between CISA and Australian iron ore suppliers have entered into the most challenging period. It’s unlikely, said Xu, that any agreement can be produced in the short term.

Steel spot prices both on the domestic and international markets are currently surging, driving up steel production and subsequently iron ore demand.

However, Chinese steel plants may begin cutting output from the fourth quarter due to possibly arisen faltered steel demand, which may favor China in the iron ore price negotiations, Xu added.

It is reported from Shanghai Securities News friday that China is still in talks with the world’s major iron ore firms for the annual supply deal. Shanghai Securities News cites Shan Shanghua, secretary-general of the China Iron & Steel Association (CISA).

CISA demands all steelmakers around the country accept one unified iron ore import price once the price for 2009 is determined, said Shan during an expanded conference of the CISA standing council.

The measure aims at regulating excess iron ore import of small steelmakers and intermediary traders, which had hampered the negotiation by creating unnecessary demand, said Shan.

In the first half of this year, iron ore import soared by 29.29 percent year on year to 297 million tonnes, while intermediaries imported 131 million tonnes, up 90.43 percent from last year.

However, Shan did not reveal when the negotiation would reach an agreement.

China has been working to seek a cut of more than 40 percent in iron ore price from the world’s three biggest mining companies — Vale of Brazil, Rio Tinto and BHP Billiton, said the CISA earlier.

The association said in a statement in late May that China’s steel companies would refuse to accept the 33-percent price cut reached between Rio Tinto and Japan’s Nippon Steel Corp.

Such price cuts would lead to overall losses for Chinese steel companies, said CISA.

If the CISA failed to reach a supply agreement with any of the three biggest mining companies — Vale of Brazil, Rio Tinto and BHP Billiton — Chinese steel makers would have to turn to the spot market for supplies.

According to the statistics released by the CISA Thursday, 71 large and medium steel manufacturers gained 1.73 billion yuan (253.29 million U.S. dollars) in the first two quarters.

It is reported from the China Iron and Steel Association last friday that China’s major steel makers gained net profits of 6.3 billion yuan in June, which helped reverse the trend of losses for the first half of this year.

During the first half of 2009, net profits of these steel makers totaled 1.73 billion yuan.

The association said in a report that China’s steel industry is still in recession. Among the 71 mid- and large-sized steel enterprises, 25 suffered losses during the year’s first half.

It is predicted that crude steel output will hit 660 million tons for the full year of 2009, while consumption is expected to reach 453 million tons.

This compared with a combined profit of 1.04 billion yuan in the 71 large and medium-sized steel mills in May. Their aggregate profit totalled 1.73 billion yuan in the first half this year, said the latest statistics released by the China Iron and Steel Association this week.

Eight of the 71 companies were still losing money last month, compared with 20 in May.

Steel prices rose “at a stunning rate”, said Xu Xiangchun, analyst of Shanghai Ganglian E-commerce Co., Ltd., an IT service company specializing in collecting steel information.

The price increase of major steel producers was the main reason for climbing market prices as there were no statistics indicating a surge in demand or supply shortage, Xu said.

Some 46 steel companies had raised prices this month as of Wednesday, according to statistics of the Umetal.com, an industry service provider.

The price of cold rolled coil in the Beijing market has soared by 500 yuan per tonne since July, and hot rolled coil by 340 yuan, according to the statistics from the IT service company.

The per-tonne prices of medium plates and screw steel also saw an increase of 250 yuan and 600 yuan respectively.

Share prices of Baosteel, the country’s largest steel maker, gained 3.43 percent to 9.35 yuan as of 2:05 p.m. Thursday. Angang Steel Company Ltd. surged 4.37 percent to 17.2 yuan.

It is reported that the European Union decided on Monday to impose definitive anti-dumping duties on imports of Chinese steel wire rods for five years, further straining bilateral trade relations.

A meeting of foreign ministers of the 27-nation bloc approved without discussion the measure of imposing a definitive anti- dumping duty up to 24 percent on China’s imported steel wire rods. The definitive measure came after temporary duties were slapped in February following European producers claimed that Chinese producers had sold their products in low prices and hurt their businesses.

The imposing of definitive anti-dumping duties needs the approval of all 27 member states.

The European Commission, the EU’s executive body, launched last year an anti-dumping probe against steel wire rods from China, Moldova and Turkey following a complaint lodged in March, 2008 by the European Confederation of Iron and Steel Industries (Eurofer), a Brussels-based industry body representing major EU steel producers such as ArcelorMittal and ThyssenKrupp.

The EU anti-dumping investigation normally takes no more than a year, and in any case must be completed within 15 months, after which the EU governments will have the final say on whether to impose definite five-year anti-dumping duties.

However, the commission may impose provisional duties within 60 days to nine months during the investigation period, which may last for six to nine months.

After that, the commission decides whether to impose definitive anti-dumping duties.

Since last year, the EU lodged a series of anti-dumping probes against steel and iron product imported from China out of baseless claims, straining bilateral trade relations.

Actually, European steel users are also opposed to any imposing of anti- dumping measures, fearing that they would face supply shortage if the EU takes anti-dumping measures against Chinese steel products.

China’s Ministry of Commerce has voiced regret over the anti- dumping applications and hoped to solve the issue through dialogue and negotiations. It also hoped the commission would refrain from adopting anti-dumping measures.