Chinese steelmakers court Russian suppliers

Chinese steelmakers court Russian suppliers

As China’s remarkable growth continues, several steelmakers have begun to turn to Russia as an alternative source of raw materials. Shagang Group recently imported a 73’000 ton shipment of iron ore pellets from Russia. Due to draft depth limitations at Zhangjiagang port, 26’000 tons was first unloaded at Zhoushan port. When the remaining shipment reaches Zhangjiagang, it will mark the first time Russian pellet has been discharged at the port. Jiangsu Shagang, one of China’s largest private-funded steel enterprises, recently undertook productivity expansions. The company now has an annual iron ore demand of 10 million tons, most of which will have to be satisfied via imports. Shagang used to import iron ore from Brazil and Australia. However, after the 71.5% iron ore price surge from Brazil’s CVRD and Australia’s Harmersley in 2005, it is much cheaper to import iron ore from Russia. Jiangsu Lifeng imports 14’000 tons of Russian scrap On Mar 23, 2005, the "Zolotaya Lolyma" liner with 14’150 tons of scrap from Russia arrived at Zhangjiagang port. The cargo was destined for Jiangsu Lifeng International Group Co., which imported scrap from Russia for the first time.