A new agency set up by the Chinese communist government - the China Mineral Resources Group Ltd (CMRG) was officially launched in China by the country’s Vice-Premier Han Zheng to boost up supply in order to meet China's huge demand for mineral resources - in particular iron ore.
China Mineral Resources Group Ltd (CMRG) has been established with the aim of guaranteeing the supply of critical minerals by overseeing domestic and international trades, supply lines and development.
The stated scope of China Mineral Resources Group Ltd (CMRG) includes mining (excluding coal) ‘iron ore processing, import and export of commodities, the sales of metal ores, and warehouse and supply management services.
The state-owned mining giant although recently formed last month has already signed huge contracts of strategic cooperation deals with three big international rare minerals supplier - Brazil’s Vale, Australia’s BHP Billiton, and Rio Tinto, an Anglo-Australian firm at this year’s China International Import Expo in Shanghai.
China Mineral Resources Group Ltd (CMRG) has been established with the aim of guaranteeing the supply of critical minerals by overseeing domestic and international trades, supply lines and development.
The stated scope of China Mineral Resources Group Ltd (CMRG) includes mining (excluding coal) ‘iron ore processing, import and export of commodities, the sales of metal ores, and warehouse and supply management services.
The state-owned mining giant although recently formed last month has already signed huge contracts of strategic cooperation deals with three big international rare minerals supplier - Brazil’s Vale, Australia’s BHP Billiton, and Rio Tinto, an Anglo-Australian firm at this year’s China International Import Expo in Shanghai.
How Will This Impact Singapore's Real Estate?
This new move by China may upset the nearly $200 billion iron ore industry worldwide as Beijing expands its efforts to increase control over the natural resources needed to feed its economy.
China Mineral Resources Group Ltd (CMRG) is poised to become the world’s biggest iron ore buyer as soon as next year as reported by Bloomberg news agency. It is expected to begin consolidating purchases on behalf of about 20 of the largest Chinese steelmakers including leader China Baowu Steel Group Corp., according to people familiar with the situation.
Real estate consultant Kiwi Lim felt that President Xi may be trying to control the supply of raw materials, e.g. iron ore through the creation of this new agency to gain more clout with the world's powerful suppliers like Rio, BHP Group, Fortescue Metals Group, Vale, etc in order to satisfy China's immense hunger for raw materials. But this may invariably reduce the supply of iron ores and other metals worldwide to cater to the needs of other nations' infrastructural development. This may lead to more competition for raw metal materials from next year as countries around the world tries to get their hands on the remaining iron ore available in the market leading to gradual rise in prices.
"How will this impact the construction industry where steel and iron are critical and in great demand, only time will tell." said Kiwi Lim
This new move by China may upset the nearly $200 billion iron ore industry worldwide as Beijing expands its efforts to increase control over the natural resources needed to feed its economy.
China Mineral Resources Group Ltd (CMRG) is poised to become the world’s biggest iron ore buyer as soon as next year as reported by Bloomberg news agency. It is expected to begin consolidating purchases on behalf of about 20 of the largest Chinese steelmakers including leader China Baowu Steel Group Corp., according to people familiar with the situation.
Real estate consultant Kiwi Lim felt that President Xi may be trying to control the supply of raw materials, e.g. iron ore through the creation of this new agency to gain more clout with the world's powerful suppliers like Rio, BHP Group, Fortescue Metals Group, Vale, etc in order to satisfy China's immense hunger for raw materials. But this may invariably reduce the supply of iron ores and other metals worldwide to cater to the needs of other nations' infrastructural development. This may lead to more competition for raw metal materials from next year as countries around the world tries to get their hands on the remaining iron ore available in the market leading to gradual rise in prices.
"How will this impact the construction industry where steel and iron are critical and in great demand, only time will tell." said Kiwi Lim
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Is China Snapping Up Iron Ore To Build More Property?
The stock of unsold new homes in many Chinese cities has hit its highest since 2019 amid fragile demand in the country’s downtrodden property market. According to China Real Estate Information Corp (CRIC) which monitors 100 Chinese cities, the number of unsold new homes in tier-three and tier-four cities is not seeing any reprieve.
China’s property market has repeatedly grappled with crises since 2020 and problems worsened in August 2022 as the country saw groups of buyers at mortgage boycott gatherings and developers’ financial strains further hurt confidence in the sector. Prices of unsold properties were dragged down by weak demand especially in smaller cities coupled with halted or persistently slow deliveries by heavily-indebted property developers all over China.
Desperate to improve their cash flows, property developers in Chinese provincial capitals are struggling to find buyers with some cities reporting more than 20 million square meters of unsold new home stock each according to CRIC.
The stock of unsold new homes in many Chinese cities has hit its highest since 2019 amid fragile demand in the country’s downtrodden property market. According to China Real Estate Information Corp (CRIC) which monitors 100 Chinese cities, the number of unsold new homes in tier-three and tier-four cities is not seeing any reprieve.
China’s property market has repeatedly grappled with crises since 2020 and problems worsened in August 2022 as the country saw groups of buyers at mortgage boycott gatherings and developers’ financial strains further hurt confidence in the sector. Prices of unsold properties were dragged down by weak demand especially in smaller cities coupled with halted or persistently slow deliveries by heavily-indebted property developers all over China.
Desperate to improve their cash flows, property developers in Chinese provincial capitals are struggling to find buyers with some cities reporting more than 20 million square meters of unsold new home stock each according to CRIC.
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