China eyes long-term contracts for Indian iron ore

China eyes long-term contracts for Indian iron ore

Chinese Chamber of Commerce of Metals Minerals & Chemicals Importers & Exporters (CCCMC) announced that some Chinese steelmakers would make a visit to India in August in order to sign long term iron-ore supply contracts. India accounts for 25 percent of China's iron ore imports, being the second largest iron ore exporter to China. China used to buy Indian iron ore on spot market and Australian ore with long-term contracts. However, the decline in steel prices led Chinese steelmakers to consider buying Indian iron ore with long-term contracts instead of the Australian ore. Current price of Australian iron ore in China is around $50/ton. The spot price of iron ore from India is currently $6 – 8/ton higher than the Australian ore price but Chinese steelmakers hope to obtain more favourable contracts from Indian iron ore producers. It's reported that Baoshan Iron and Steel (Baosteel) and Wuhan Iron and Steel Group will also take place in the visiting group.