China is looking forward to buy more iron-ore from India to cover up the strong demand of its steel in international market.
Chinese steel mills are approaching towards Indian iron-ore to fulfill the strong demand of China steel in the international market, whereas the government is attempting to rein the nation' steel output.
As per Chinese Iron-ore traders, mid-grade Indian iron-ore cargo prices increased to US$ 74-75 per Ton, including freight & cost, from US$ 72-73, a month before, similar to price hikes in domestic iron-ore.
"Strong demand & recent price hikes in Indian iron-ore are not refraining Chinese mills owners from using Indian ore. Profit margins are still significant & strong output is expected in fourth quarter as well," according to a senior research analyst at RNCOS.
In September 2006, Indian iron-ore imports in China declined to 12.9 % year-on-year to reach nearly 5 Million Ton, but rose in first nine months to around 58.3 Million Ton, up by 11.2 %. With such a strong production, traders were surprised to see a decline in October iron-ore imports to 22 Million Ton - lowest in 15 months.
Crude steel production in China rose to around 339 Million Ton in first nine months, increasing by 18.4% year-on-year. In 2005, crude steel production was around 349 Million Ton. China is now considered as the top exporter of steel in the world. The country exported total 32.9 Million Ton of steel in first ten months of 2006, almost one-third of US annual output.
Traders believe that the longer monsoons in Western India were the only reason for low exports. However, some view the decline to be an indication of limited iron-ore supplies, as India requires more iron-ore for itself. However, they are expecting the imports of iron ore to increase from Brazil & Australia in future.
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