I am not an economist or financial person but I look, listen and observe. I reckon that RIO and BHP should b very carefull with their brash dealings with China.The only who can see the full picture is Twiggy. These people have long memories. Now they are trying to become a major player in Australia mining.
I mentioned this before,chinese have a lot of patience and slowly buying brick by brick. And suddenly they own the lot and the will only supply china. The good times may not last. ---------------------------------------- http://www.news.com.au/chinese-newcomer-muscles-in-on-iron-ore-majors/story-e6frg8zx-1225861314859?from=public_rss ---------------------------------------------------------- HANLONG Mining expects to invest $5 billion in Australian miners as part of its plans to become a "fourth force" in the country's iron ore sector, rivalling BHP Billiton, Rio Tinto and Fortescue Metals Group.
The Australian subsidiary of Chengdu-based conglomerate Sichuan Hanlong Group says it has lined up financing from China Development Bank and the Export-Import Bank of China to make investments in Australian iron ore assets.
The group has held preliminary talks with about a dozen small and mid-sized companies in South Australia and Western Australia, sources say.
Last week, the company completed the acquisition of a 57 per cent stake in Moly Mines, a molybdenum miner in Western Australia's Pilbara region. Sichuan Hanlong has also acquired a controlling interest in General Moly, a US molybdenum miner. Taken together, the interests in both miners are likely to make Sichuan Hanlong a major player in the global market for molybdenum, which is commonly used in steel alloys and to remove sulphur impurities from petroleum products.
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Supply of the metal is currently dominated by about half a dozen companies.
"Hanlong has said they want to use Moly Mines to become an international mining house specialising in iron ore, molybdenum and ferroalloys," said Derek Fisher, chief executive of Moly Mines.
The model for the company is Fortescue, the miner created by entrepreneur Andrew Forrest in 2003 that has become one of Australia's top 50 companies since it built its own rail and port facilities to get assets out of the iron-rich Pilbara region to market.
Money was also available from Hanlong's banks to fund infrastructure investment, Mr Fisher said.
"Infrastructure is part of the equation and Moly Mines and Hanlong are currently in discussion on that," he said.
The seaborne trade in iron ore is currently dominated by BHP, Rio Tinto and Brazil's Vale.
Earlier this month, the China Iron and Steel Association urged local steelmakers to stop buying ore from the three producers in protest at their move from annual benchmark pricing to quarterly contracts more influenced by spot market prices. CISA described the new pricing system, which has driven prices for some steelmakers up by as much as 100 per cent over last year's benchmark, as monopolistic.
