China Weighs New Measures to Punish Australia

China Weighs New Measures to Punish Australia

Policy rifts divide trading partners, raising risks for energy and commodity deals.

Andrew H. Sweet
Andrew H. Sweet
  • Tensions are rising over iron ore, Australia's top export to China and an essential resource for the world's leading steelmaker.
  • Australian ore exports of 713 million tons accounts for 61 percent of China's ore imports last year.
  • China has run out of patience and options for punishing Australia, raising the risks for the iron ore trade as prices rise.
  • Record prices for iron ore supplies have raised concerns about rising cost pressures in China's steel industry, even though Chinese demand has been the primary driver of the price increase.
  • Last year, China's crude steel output surpassed 1 billion metric tons, a new high, as production increased 5.2 percent due to COVID recovery and infrastructure investment.

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