Hajime Bada: High raw material prices have shifted profits to miners

Hajime Bada, worldsteel vice chairman and president and CEO of JFE Holdings, said at the annual meeting of the World Steel Association (worldsteel) held in Paris on October 12 that, due to increasing steel demand in emerging economies and the oligopoly of raw material suppliers, mining companies are requesting shorter contract periods, resulting in a significant challenge for the steel industry to ensure a moderate price together with a stable supply.
 
Citing McKinsey report findings, Mr. Bada said that high raw material prices have resulted in a huge shift in profits toward mining, Mr. Bada said, adding that the steel industry needs to expand raw material sources, diversify raw materials, such as low quality iron ores, and also diversify production processes.