At the time of Enrico Mattei Italy sought to develop domestic oil and gas production (as well as secure its own sources of external supply) so as not to have to depend on the 'seven sisters' who dominated the international oil market.
China is in a similar situation regarding the iron ore, of which she is by far the world's leading consumer. On the other side of the trading table are the 'three sisters' – BHP Billiton, Rio Tinto and Vale – which are in practice a cartel of sellers (they control two-thirds of the world's iron ore exports).
But China now wants to develop domestic manufacturing (reaching 45% of needs, from 35% last year) and enter into direct agreements with producing countries to not having to depend on the 'three sisters'. And it intends, as far as the imported part is concerned, to get half of the imports from mines in which China has invested. The efforts of the Chinese are good for the global steel industry as a whole, insofar as production increases, the cartel is weakened, and therefore the pressure on prices is eased.
In the first 8 months of this year, China imported 448 million tons of iron ore (+3.5% on last year) and the average price in the period soared by 38%. China blames the 'three sisters' cartel: the average margins of the Chinese steel industry are lower than those of the rest of the industry.
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