The spot price of iron ore in the Chinese market has risen to a new high in six months. Last week, the domestic first-line steel mills including Baosteel also collectively increased their prices. In addition, India, the main supplier of iron ore in China, also intends to increase export tariffs, which will cause the cost pressure in the steel industry to increase dramatically.

According to the latest data provided by TSI, the iron ore index agency, the current price of 62% iron ore has reached US$117.6/ton, and the price of 58% grade iron ore has also reached a high of US$153.9/ton.

According to the data of the Nisshin Shinkansen, the average price of 25mm secondary rebar for major products in major domestic markets was 4,792 yuan per ton last week, and rose 45 yuan per ton for a single week; the average price of 6.5mm high-end rebar was 4,766 yuan per ton, up 23 per week. Yuan / ton. At the same time, the prices of coils at Baosteel and Wuhan Iron and Steel were raised by RMB 100-200/ton, and the ex-factory prices for building materials from Shagang, Liuzhou Steel, and Guangzhou Steel were also increased by RMB 30-50/ton. Anshan Iron & Steel raised its steel prices by 50 to 300 yuan per ton in February.

In addition, according to media reports, the Indian government plans to start exporting iron ore exports for the 2011-2012 fiscal year with a 20% export tariff on April 1 to ensure domestic supply. Analysts said that once this policy is implemented, the price of iron ore will push domestic steel companies to face greater cost pressures.

India currently produces about 220 million tons of iron ore per year, about half of which are exported, and 80 to 90 percent of export iron ore is exported to China. India is a major supplier of iron ore to the Chinese spot market. Its share of the Chinese market has been around 20% in the past five years. The Indian government has increased tariffs on iron ore exports three times since December 2008, from the original 5% to the current 15%.