Chinese Regulators Eye Irregularities in Spot Iron Ore Trading

By Shivani Singh and Min Zhang
Monday, June 21, 2021

China's state planner, the National Development and Reform Commission (NDRC), said on Monday it and the market regulator are jointly looking into the iron ore spot market and have pledged to crack down on hoarding and speculation.

The move comes after NDRC said on Thursday that new rules on the management of price indexes for commodities and services will be effective Aug. 1 and will standardise price index compilation and transparency of information.

During a visit to the Beijing Iron Ore Trading Center Corporation (COREX), the NDRC and State Administration for Market Regulation surveyed iron ore transactions and price changes this year, the state planner said in a statement.

Transactions on iron ore platforms such as COREX, done via broker screens, are used by various price index providers for their price assessments.

Some of these indexes, often published by private index providers, are then used to settle physical trades of commodities or to settle a derivative on an exchange.

NDRC announced on Friday that an investigation has been launched into coal prices, as China is taking several steps to tamp down commodity prices.

The regulators on Monday also discussed ensuring supply and stability of prices of commodities such as iron ore, according to the statement.

"Iron ore prices have risen significantly and remain high, putting pressure on production and operation at mid- and downstream companies," said the statement, citing a meeting held by the authorities.

Benchmark iron ore futures on the Dalian Commodity Exchange plunged as much as 9% to 1,119 yuan ($173.14) per tonne on Monday, narrowing their gains to 30% so far in 2021.

The regulators said China would closely monitor spot trading prices and investigate malicious speculation in a timely manner.

They would also "strictly punish and disclose" irregularities such as hyping prices and hoarding, and maintain good market order, said the statement. 

(Reuters reporting by Shivani Singh and Min Zhang; Editing by Kim Coghill, Muralikumar Anantharaman and Emelia Sithole-Matarise)

Categories: Bulk Carriers Ports Iron Ore

Related Stories

British Port Association Responds to the Government's Annual Port Trade Statistics

Shipbuilding: Bulk Vessel Deliveries Soar

US Grain Shipments Surge 9% in face of Chinese Tariffs

Current News

US Commerce Disorganization Stalls Thousands of Export Approvals

Russian Oil Vessels Forced to Divert From India Under US Sanctions

Hanseatic Global Terminals Launches Latin America Expansion

Two CK Hutchison-Operated Ports Near Panama Could See State Partnerships Take Over

Subscribe for Maritime Logistics Professional E‑News