China forecasts increase of 28.6 pct in iron ore production for 2006

24 March 2006

Beijing, China, 24 March – China, the world’s largest importer of iron ore, said Thursday it expected to produce 28.6 percent more ore this year than in 2005.

The National Commission for Development and Reform said that China would produce around 540 million tons of iron ore, the raw material for making steel, in 2006, which would represent an increase of 120 million tons against 2005.

The increase in domestic production could replace the more than 60 million tons of iron ore imported by China each year, the commission said, without giving details on iron ore imports for the year.

China’s Iron and Steel Association has estimated that the country will import 300 million tons of iron ore in 2006, as compared with 275 million tons last year.

The Chinese steel industry, represented by the Baosteel Group, will begin a new round of negotiations on iron ore prices for 2006 contracts with large international companies next week, Chinese news agency Xinhua reported Wednesday.

China, which is the world’s largest producer of steel, has tried to have some influence on mining giants such as Companhia Vale do Rio Doce, Rio Tinto and BHP Billiton in terms of setting annual ore prices, which will be implemented as of April 1. (macauhub)