Is the great steel boom about to bust? You could think so, judging by the steelmakers' cries of horror at the huge price rises that iron-ore miners have just forced on them. These came on top of sizeable rises for scrap steel, and even bigger ones for coking coal, the steelmen's other main raw material. These price rises all sprang partly from world recovery, but mostly from China's soaring demand for steel and raw materials. Yet the real threat is quite different: China's own steel industry. The ore-price hikes came as a shock. These prices, for the 12 months from April 1st, are led by the annual negotiations between the big Japanese steel firms and (separately) the big three miners: BHP Billi-ton and Rio Tinto, supplying ore from Australia, and CVRD, from Brazil. Last year these led to 19% rises. Until recently, analysts expected 20-30% this time. Rio Tinto was ready to settle at about 45%. No way, said CVRD: we want 90%.
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