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Following the signing of Japan and the three miners, after a new round of iron ore prices, high rise and quarterly pricing mechanism has been strongly opposed to the global steel prices, but does not help, price hikes and a long association mechanism was overthrown has become an indisputable the fact that iron ore pricing mechanism is almost been a fundamental subversion. South Korea has agreed to a 90% rise in steel prices in Europe have agreed to a 100% gain, are accepted quarterly pricing. Recently, according to media reports, some domestic steel enterprises received 96.4% of the increase to the quarterly price of compromise. According to the China Steel Association official said, for various steel prices and temporary price agreement reached by the three major mines, steel production in order to ensure smooth implementation of the standard requirements in the implementation of industry circumstances, in order to ensure the supply of iron ore and production needs , this does not violate trade regulations, as the temporary price negotiations by the respective companies. Long association price changes to the quarterly pricing model will bring global steel industry, a fundamental change. Quarterly pricing pricing cycles, making the spot ore price iron ore price to move closer, the frequency increased price volatility, increased risk of iron and steel industry. Monopoly of the three miners made of steel enterprises in the global iron ore pricing, the lack of voice and easy subject to three major mining companies are forced to accept the high price of raw materials, pushing up the cost of steel, compression steel enterprise profits. For China, the lower grade domestic iron ore resources, foreign dependence as much as 70%, while crude steel production in China first in the world, the demand for iron ore showed rigidity, quarterly pricing system, once established, the Chinese steel industry is undoubtedly far-reaching impact. A raw material price changes, increased frequency of fluctuations in steel prices Raw material prices and steel are the two factors interact, when raw material prices, the push up steel prices, increased demand for raw materials, boosting raw material prices rise further; the other hand, when steel prices fall, demand for raw materials reduced, making raw materials of decline followed. By May 2007 the import of iron ore spot ore price has with the thread HRB400 (Shanghai), the correlation test found that the correlation between the two to 0.829. Iron and rebar price correlation tests On rebar and iron ore, coke, raw material prices of the two regression test showed 1.69% each time when iron ore prices, steel prices rose 1%; every time when coke prices rose 0.66%, Rebar prices rose 1%. Iron ore price volatility is almost coke on nearly three times the volatility of steel prices and rising as the price of iron ore, iron ore, will share the cost of increasing weight. Rebar and iron ore, coke price regression results Therefore, the pricing system as soon as the quarterly real place, the steel industry will face great risk of price fluctuation. Whether steel prices, steel traders, steel companies will end the price fluctuations experienced the pains of the rising steel price adjustment will be more frequent. I am an expert from ledindustriallights.com, while we provides the quality product, such as LED Downlight Fixtures , LED Ball Bulbs, Outdoor LED Floodlight,and more.
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