Analysis On The Reason And Counter Measures Of China’s Imported Iron Ore Lacking Pricing Ability

The iron and steel industry, as the basic industries in China, plays a vital role in the national economy. The iron ore always has a huge demand as the raw materials of steel melting, of which the importance of iron ore can not be ignored. With the course of the national’s industrialization, the demand of iron ore for steel industry grows rapidly, while the domestic iron ore production can not meet the demand. Since2003, more than one half of the iron ore for steel industry needs to be imported from other countries to meet the production demand, which makes China become the largest buyer of international iron ore,In recent years, with the rise of economic development, China has a tremendous and increasing demand for bulk material. China is called "a major importer" in the world market, but also set at naught as "pricing dwarf. Chinese enterprises didn’t get commodity pricing in the international market, and the imported price of iron ore continued to surge, but we can just accept the price reluctantly and lack the basic right of speak in international negotiations. It is not only brought great cost pressure for struggling survival to iron and steel industries, but also the related downstream industries through the mechanism transmission, such as home appliances, ship building, machinery, construction, automotive and other basic industries of the national economy. Therefore, many experts at home or abroad attach great importance to the study of iron ore market.The status of highly dependence on imported iron ore, and the tremendous imported volume, the surge in imported price, but meanwhile with no pricing right makes security risks on China’s resource commodities. Therefore, this paper focus on a depth analysis on the reason why the main importing country lack the matching pricing ability, and how to deal with the irreversible status in not a short-term and hope can make certain reference to other resources commodilities.The whole paper is divided into four parts:The first part is an introduction to the research background of this paper, indicates the research purpose and meaning and also the research contents and research structure. The second part paving the way for the following part, includes the second chapter which analyze both the international and domestic market of iron ore from the perspective of supply and demand, and the third chapter introduces the history of international iron ore pricing, and comes to the conclusion of China’s dilemma on pricing iron ore, as well as its impact on our economy.The third part is the focus and purpuse of this paper. The fourth chapter aims to analyze the problem and the fifth chapter aims tosolve the problems. The fourth chapter try to analyze the reasons of lacking iron ore pricing ability from the perspectives of domestic and international markets. In the domestic perspective, the author analyze the industrial concentration, the order of imported market of iron ore and the forward market respectively; in the international perspective, the author analyze the international iron ore market structure, competitive advantage of foreign iron and steel industry and the negotiation skills respectively. The fifth chapter summarizes the counter measure and suggestion suitable for China to strive for iron ore pricing in two perspectives of the country and enterprises on the basis of previous reasons analysis.The last part chapter sixth is the concluding part of this paper, sum up the conclusion of this paper and point out the deficiencies of this article and future directions of research.