Earlier this month, Beijing resumed some supplies from Australia in a bid to end diplomatic differences that have persisted for more than two years.
China Baowu Steel Group Corp. Baowu said it hopes to capitalize on efforts to restore trade relations between China and Australia, while China's demand for raw materials recovers and will seek closer ties with iron ore producer Rio Tinto.
Baowu entered into a joint venture with Rio Tinto last year to develop the Western Range project in Western Australia. The cost of this initiative was $2 billion. The Chinese firm has agreed to buy up to 126.5 million tons of iron ore at market prices over 13 years through a joint venture.
Chairman Chen Derong said the Chinese company wants to do more exploration and production to deal with global market turmoil. "We can't rely on the old way of guaranteeing such a huge supply to China, we need to modernize."
Last year, Baowu took over Sinosteel and several other smaller steelmakers as part of an industry-wide integration to give China more bargaining power in the international market and help meet carbon reduction goals.
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