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Ore center eyes price index aim

CHINA will launch its first iron ore trading platform on Monday as it bids to establish its own price index since it is the world's top importer of the steel-making ingredient.

The trade center in Rizhao, a port city in eastern Shandong Province, will provide electronic commerce services, including information exchange, insurance, and settlement for iron ore suppliers and steel mills, according to Xinhua news agency.

Five private-sector bulk commodity dealing companies in Shandong are joint investors in the center which has a registered capital of 20 million yuan (US$2.93 million).

"As the biggest iron ore importer, China has not set an iron ore price index to date. The iron ore trade center will promote orderly iron ore imports and standardize activities of trading parties, and gradually facilitate China to launch its own iron ore price index in the future," Xinhua quoted Bai Wenhui, general manager of one of the center's shareholders, as saying.

Analysts said the new trading center is likely to mainly serve small steel makers which don't buy ore from the world's biggest ore miners, including Vale, Rio Tinto and BHP Billiton, under annual term prices.

China imported 443.7 million tons of iron ore last year, or half of the volume of the world's imports, Customs data showed. Imports rose 23 percent to 188 million tons between January and April this year as traders took advantage of low prices to stock up.


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