The rise of nanometers

Australia.

Melbourne.

BHP Billiton headquarters.

After hanging up the phone, James Carter, whose face was extremely solemn, ordered his secretary: "Have the others come over for the meeting immediately."

Perhaps sensing that the president was in a bad mood, secretary Elena nodded hurriedly and ran out to inform other vice presidents and department heads.

In the office, Carter turned on the office computer and found the details sent by Charles.

After reading it, two vice presidents at the headquarters and three department managers appeared in the office.

Vice President Wood asked curiously: "Carter, why are you so anxious? Are those Chinese people trying to negotiate again?"

"Our big trouble is coming." Before Carter could finish speaking, the phone on his desk rang. He glanced at it and answered the phone helplessly.

But as he spoke, he gave up his seat and motioned for Wood and others to look at his computer.

Wood and others gathered around the computer and soon saw Charles' detailed report. The more they read the email, the heavier the atmosphere in the office became.

Ten minutes later, Carter finished the phone call with the president of Rio Tinto.

"Now tell me, what should we do?"

"Could it be a trick by the other party?" one of the managers said.

Wood, who is in charge of mineral investment, suggested: "Carter, now we have only three options. The first option is to enter into a price war with the other party, betting that the other party's inventory can only last eight months."

"The second option is to use funds to purchase the other party's futures and raise the price. This is also a bet on the other party's insufficient inventory."

"The last option is to ignore the other party, which is also to wait for the other party's inventory to be exhausted."

Carter was worried that Wood's proposals were all based on Blue Star Mining's insufficient inventory.

If Blue Star Mining's inventory or production is sufficient, the consequences for BHP Billiton will be very dire.

Moreover, transactions on the Dalian Exchange are required to be settled in Chinese yuan. In addition, accounts opened by foreign companies only support cash accounts for the time being.

In other words, if they join forces with Rio Tinto and Vale to take part of the futures, they must prepare 100 billion yuan in cash.

Moreover, the major steel companies in China are not fools. They purchase iron powder futures on a large scale, which will result in a crazy increase in the price of iron powder. At the same time, many steel companies will hold the futures and wait for the price to rise or for delivery at maturity.

Being able to purchase one-third of the iron powder futures is a blessing from God.

The problem is that hundreds of billions of dollars are spent to purchase iron powder. If Blue Star Mining's iron powder production is still in sufficient supply in the second half of next year, BHP Billiton will definitely lose tens of billions.

They are still a listed company, and such a big strategic decision may cause the stock price to plummet if they are not careful.

After a while, Goy, the president of Vale, also called, and Carter discussed with him for more than half an hour.

Vale is also in a dilemma now. They are also struggling with whether to spend money to acquire Blue Star Mining's iron powder and raise the market price; or to lower the price of iron ore and start a price war with Blue Star Mining; or to wait and see what happens. Let’s see if Blue Star Mining is bluffing.

Carter, who was in a dilemma, said helplessly: "Wood, you should understand that we have just emerged from the economic crisis in the second half of this year. If we spend so much money, our capital chain may not be able to bear it."

"The only option is to lower the price." Wood replied with a headache.

On the first day of official operation of Dalian Ore Exchange.

The capital market reacted very quickly to this incident. After the rice stock market opened that day, the prices of Vale, BHP Billiton, Rio Tinto, and other companies involved in iron ore, bauxite, and potassium sulfate plummeted.

The company with the largest decline was Rio Tinto Group, which had just recovered. The largest single-day decline reached 27.3%, and the decline at the close was 14.2%.

Vale and BHP Billiton also fell by 11.4% and 9.3% respectively.

If the three major international mining groups cannot eliminate the impact of Blue Star Mining, investors may in turn short their stocks.

…

Magic City.

Vale representative Ole Juan, who had just returned to the office, was asked out by Ding Lixing, who had also just returned to the Magic City.

In a nearby business hotel, the two parties found a business box. Ding Lixing didn't beat around the bush and went straight to the point.

"Mr. Juan, we are all old friends. Baosteel has obtained 35.7 million tons of iron powder futures from the Dalian Exchange. We may need to consider next year's purchase contract."

While pouring tea, Juan reminded: "Ding, you should know that stability is the most important thing in the ore trade, and the supply of Blue Star Mining may not be long-term."

Picking up the tea cup, Ding Lixing sipped the tea slowly, and then said: "But Mr. Huan, our Baosteel's steel production has only reached about 30 million tons this year. The futures we have eaten this year are enough for us to use one day." More than a year.”

"Ding, the price is negotiable. After all, having another supply channel will be good for you." Juan's attitude softened.

"What's the price of Vale?" Ding Lixing has never been as relaxed as today. He used to make tea and water for the other party.

Juan thought for a while and raised the psychological price given by the headquarters: "How about 750 yuan?"

"750 yuan? This price is too high. If it is 500 yuan, we will consider giving you part of the purchase share in the next year."

Juan was a little anxious: "For part of the year after tomorrow, the long-term contract price was used in the past. We think this mechanism should continue to be maintained."

Ding Lixing, who was enjoying the tea calmly, secretly despised it. If Blue Star Mining hadn't done this, these guys would have had strong objections to the long-term cooperation plan, and now they would turn around and demand that the long-term cooperation plan be maintained.

"Huan, there is no need for a long-term agreement. After all, iron powder futures are now traded on the Dalian Exchange. Baosteel can't engage in a long-term agreement on its own!"

At this moment, Juan's assistant hurried over, whispered a few words in his ear, and took another document and handed it over.

After hearing the assistant's report, Juan seemed to have been struck by a bolt from the blue.

It turned out that some steel companies sent a request to modify the contract to Vale. If Vale did not agree to reduce the price of iron ore, they would rather breach the contract than purchase Vale's iron ore.

Faced with the backlash from the Chinese steel company, if Ding Lixing hadn't been there, he would have cursed loudly. Huan gave an assistant a look: "I know, I will deal with it later."

"OK."

After a while, the assistant left the box.

Ding Lixing asked with a smile: "Huan, after this year's contract is completed, next year's iron ore will be temporarily undecided! After all, Baosteel's funds are limited."

"Ding, how about 700? This is my greatest sincerity."

Ding Lixing still shook his head.

The two parties still failed to reach an agreement in the end, and when Ding Lixing left, Juan immediately cursed.

Similarly, the commercial offices of BHP Billiton and Rio Tinto in China have received cordial greetings from major steel and aluminum companies.

Either they ask for a price reduction, they mean that they will not purchase ore next year, or they directly breach the contract and do not even want the purchased ore.

For a time, the business of the three major international mining groups in China suffered unprecedented setbacks.

Even the steel and aluminum companies in Japan and Korea are ready to take action.

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