China plans to invest heavily in mining of iron ore overseas to break the monopoly of the Big Three

Li Xinchuang, deputy secretary-general of the China Iron and Steel Association, said in an interview with ChinaDaily recently that as the world's largest steel producer and iron ore demander, China has formulated a plan for large-scale investment in overseas iron ore development. Reduce dependence on the Big Three iron ore. He said that this plan will be implemented during the 12th Five-Year Plan period (2011-2015).

It is understood that China's iron ore imports from Brazil, Australia and India accounted for 62.3% of all demand in 2010, and China's steel production is still heavily dependent on imported iron ore.

Li Xinchuang stated that the main purpose of China’s implementation of the above plan is to break the monopoly of the Big Three on the global iron ore market. He said that China’s goal is to strive to reduce the proportion of imported iron ore in its total demand to less than 50%. In order to achieve this goal, China will increase the development of overseas iron ore resources. The state plans to invest heavily in the acquisition of overseas iron ore assets or invest in some large-scale iron ore development projects.

The three companies represented by Brazil's Vale, Australia's BHP Billiton and Rio Tinto Group currently monopolize 75% of the global iron ore market.

Li Xinchuang said: "At present, China's imported iron ore has less than 10% of the projects owned by China from ownership." He said: "We hope that this figure will increase to 50% in the next 5-10 years."

Luo Bingsheng, vice chairman of the China Iron and Steel Association Party Committee, revealed earlier this year that at present, China’s overseas iron ore development projects have reached an annual production capacity of 150 million tons, but most of the projects have not yet been put into operation.