China is forging ahead with studies of resource reserves and acquisition possibilities in neighbouring countries, in part spurred by repeated failures to gain a say in iron ore pricing negotiations, state media reported.
“Our research into overseas mineral resources includes iron ore, gold, copper and bauxite,” an unnamed official with the technology and international cooperation department under the ministry of land and resources, told the China Business Journal.
The official acknowledged that the iron ore pricing power held by suppliers such as BHP Billiton, Rio Tinto and Vale had to some degree prompted the ministry’s latest research on overseas mining strategies, the newspaper report said.
The ministry of finance has also made estimates of the amount of the government funding needed to support relevant strategies, said the report.
The research might have an impact on Beijing’s policy making, the official was quoted as saying.
“But even if there are policies, they will not be disclosed publicly.”
Chinese state-owned resource firms have said they are looking abroad for acquisitions of a wide range of commodities such as copper and oil, but their attempts to secure supplies have met with mixed success, despite having strong buying power thanks to Beijing’s $2.4 trillion foreign exchange reserves.
China is expected to become increasingly dependent on imported crude oil in the next decade. It is already the world’s top buyer of copper, iron ore and soybeans, and since the start of last year it has been a net importer of coal, despite being the world's top coal producer.
China’s neighbours inclu-de Mongolia, Afghanistan and Myanmar, three countries in need of investment to develop their ample reso-urces, as well as oil-rich Russia and Kazakhstan.
Meanwhile, Afghanistan has recently sought investors to bid for a series of mining projects, including its huge Hajigak iron ore deposit.
The mining minister, Mr Wahidullah Shahrani, on an investment roadshow this week in London, said he had already talked to officials of ArcelorMittal, the world’s biggest steelmaker, and also planned to see mining group Rio Tinto.
“Interest is growing among the investor community. They are keen to find out more information,” he told reporters following a series of presentations.
He said mineral deposits in the country, including copper, iron ore, gold and aluminium, were estimated to be worth $1 trillion to $3 trillion.