Steel mills and trading houses in China should try to better understand the methodology of price reporting agencies (PRAs) and contribute their data to improve the accuracy of iron ore pricing, the China Iron & Steel Association has (CISA) said.
“Mills and trading houses should take initiatives to understand the pricing methodologies of the various price reporting agencies and provide their trade data to them, which would contribute to accuracy in the pricing of iron ore,” CISA Vice-Chairman Wang Liqun was quoted by media as saying at an industry conference in Qingdao.
Wang hoped PRAs would listen more to feedback from Chinese entities so that they could carry out their pricing in a fairer and more transparent manner, and called on
buyers and sellers of iron ore to adopt a composite grade.
While the there was still a surplus of iron ore supply to China, there was a widening price gap between various grades, namely high grade and medium grade due to market conditions, Wang added.
Chinese steelmakers, buoyed by strong steel margins, were now chasing high grade materials in a bid to increase their productivity.
China, the world’s largest steel producer, imported 625 million tonnes of iron ore in the January-July period, up 7.5% year on year.