Iron Ore Security Issue Escalated

A group of high-ranking Chinese departments are working together to craft policies and measures in view of observing iron ore-related issues such as how to deal with an index-based price setting tendency, supporting steel mills in the go globe strategy, setting standards for the iron ore foreign trade, addressing imported iron ore market order and possible anti-monopoly probes associated with foreign mining giants.

The soaring iron ore prices and global miners' tough stance to revise the pricing mechanism have forced China to pay a heavy price in sourcing offshore materials in the recent years. Domestic steelmakers have been operating under great cost pressure by paying $200 billion more for iron ore alone from 2003 to 2010.

The Chinese government has for the first time informed international resources companies of its stance that China will regard the issue of iron ore as a concern of national security since the result of negotiations might affect the employment of hundreds of thousands of people.