An official told Reuters that China Iron & Steel Association which has opposed the use of foreign indexes in the setting of iron ore prices wants its own pricing mechanism to enhance its bargaining power.
Local media said CISA plans to begin with a domestic price index and extend it to imported iron ore at a later stage.
Deputy secretary general Mr Li Xinchuang told Reuters that but there is still no specific time frame for the launch of the index.
Global miners Vale, Rio Tinto and BHP Billiton abandoned a decades old annual pricing mechanism in 2010 and instead adopted quarterly contract prices based on indexes published by Metal Bulletin, Platts and the Steel Index. While Chinese steelmakers have had little choice but to accept the new pricing system, CISA has continued to question the accuracy of the big overseas indexes, saying they are vulnerable to speculation and manipulation. (sourced Reuters)