The current financial crisis has partially turned into an economic crisis, and the real economy of all countries in the world has begun to be impacted. In this context, in general, the total demand for steel in the world is declining, so the prices of steel, iron ore and shipping are all falling.

This is an opportunity for China. China is a big steel country, but the international iron ore supply is in a monopoly state. China has long been constrained by iron ore suppliers and forced to accept unreasonable prices. After the financial crisis broke out, the price weakened because of the decrease in demand, which was conducive to our cost reduction. More importantly, our government has realized that iron ore has long been subject to human disadvantages, and has been planning to properly control the supply of foreign iron ore to break the long-term monopoly of foreign iron ore. Under the background of the financial crisis, the financial situation of various enterprises has deteriorated and the stock price has fallen, which has provided favorable conditions for our intervention, as evidenced by the recent investment in Rio Tinto by China Aluminum.

Of course, under the financial crisis, China's domestic demand is also decreasing, and some steel enterprises are inevitably losing money due to overcapacity and lower prices in the steel industry. Although the China government has launched a plan to stimulate the economy, it is difficult to fundamentally reverse the decline of the steel industry because of its large inventory.