Friday May 23, 2008, 12:45 pm Another Sinosteel Corporation...

Friday May 23, 2008, 12:45 pm

Another Sinosteel Corporation executive has not ruled out the Chinese steel maker taking a significant stake in Western Australia's newest iron ore producer, Fortescue Metals Group Ltd.

Asked to comment on reports last week that Sinosteel president Huang Tianwen would not rule out taking an interest in Fortescue, Sinosteel Australia deputy general manager William Ren said the company was keen to participate in a raft of Australian iron ore projects.

"Basically, the reasons or the logic behind this is Chinese steel mills need more iron ore," Mr Ren told AAP at a mining conference in Perth Friday.

"No matter if it is in the mid-west area or in the traditional Pilbara area, wherever there is iron ore, we'd like to get involved or to secure more of these assets."

Commenting on Sinosteel's $1.37 billion bid for Midwest Corporation Ltd, he said the steel maker did not intend to raise its offer.

Despite recommending the offer to shareholders, Midwest executives have not yet indicated whether they plan to accept the offer in respect of their personal shareholdings.

The bid closes on June 5, so to avoid having to extend the bid, Mr Ren said Sinosteel would employ "negotiation techniques".

He told the conference that China's steel production was slowing down slightly from "double digit" growth as part of government attempts to control pollution, but would still grow in "the top single digit".

"Production of steel capacity is 550 million tonnes per year and in the past few years, the growth year on year is way above double digits.

"At the moment, that's slowing down a little bit ... and growth will be a little bit lower than in previous years.

"With production capacity of 550 million tonnes per year and a ten per cent annual increase, you can realise how much iron ore is needed.

"50 million tonnes of steel is roughly 85 million tonnes of iron ore."

I like the part where he says Sinosteel would employ "negotiation techniques" - hmmm, does he mean using water torture methods or Chinese burns to get you to give up your shares????? LOL