The world’s largest iron ore giant Vale Vale announced its first-quarter results last Friday, including a turnover of US$6.8 billion, an increase of 4.7% from the US$6.5 billion in the fourth quarter of 2009. The reporter was informed that for China's ongoing iron ore negotiations, Vale has a tougher attitude, saying that the spot index pricing system is suitable for the Chinese market, and the Chinese market is already selling at that price.

Vale announced that its profitability was clearly good in the past year, especially in the first quarter, with a net income of 1.6 billion U.S. dollars and a year-on-year growth of 100 million U.S. dollars.

The reporter then contacted Brazil's Vale. He learned that Vale has emphasized that it has reached a permanent or temporary agreement with all its iron ore customers and has implemented an index pricing system. Vale claimed that "the Chinese market is an important driving force for the demand for iron ore."

As for the future iron ore price system, Vale said it has decided to abandon its original benchmark price system. But more reference to the spot market, no longer lengthy negotiations.

The reporter learned from the Guangdong iron and steel companies that the current spot price is about one-third higher than the long-term agreement price. Currently, major local steel mills have a small amount of long-term agreement prices. According to the new iron ore price, steel prices continue to rise. Almost a foregone conclusion. Earlier, many domestic steel mills have raised their ex-factory prices.

It can be seen that whether the price of mining machinery and equipment related to steel will fluctuate, and the result is unknown.