SteelOrbis Shanghai
Recently, Ministry of Finance People's Republic of China has announced that the value-added tax rate of metal and non-metallic mining and dressing products will be raised from 13 percent to 17 percent, effective as of January 1, 2009.
After the adjustment mentioned above, the prices of domestic iron ores will increase accordingly. Meanwhile, the value-added tax rate of import iron ores will also be raised. That is to say, the product costs of mills will thus go up.
Currently, the market prices for Indian Iron ores in Tianjin Port and iron ore concentrate are RMB 550/mt and RMB 680/mt, excluding VAT. After the increase of the VAT rate, the above prices will go up to RMB 663/mt and RMB 880/mt respectively, up about 3.5 percent compared with the current market prices.