China is not too hopeful about its steel production forecasts for the second half of 2011. The China Iron and Steel Association (CISA) highlights the effect that tight monetary policy is having on commodities demand in the nation. Zhang Changfu, vice chairman of the association said that steel production growth will slow down further in the second half of this year.
China has the world’s second largest economy. It also plans to launch its own independent iron ore price index in August this year in a bid to improve the pricing power the nation has over the main steelmaking ingredient. The China Iron and Steel Association or CISA said that the index was to be published on a weekly basis.
CISA said that the index would include domestic and import prices. In a statement made to the press in Beijing it was said that the monopoly practices of dominant global mining firms, together with chronic overcapacity at home, has made it hard for China to shed its passive role. Zhang Changfu, vice chairman of the association made the statement.
Chinese steelmakers imported 334.2 million tonnes of iron ore in the first six months of 2011.This allowed the steel output to reach 350 million tonnes that is 9.6% more than the corresponding period last year. During the same period the average price of iron ore has gone up by 42.41 % at an average of 160.89 US dollars.