Material Empire - v2 Chapter 765

In this world, there is no absolute buyer’s market or seller’s market. There is a balance between buyers and sellers, and no one can maintain an absolute advantage.

Take the oil market:

It is no exaggeration to say that oil is the blood of modern industry. Countries like the United States consume more than 600 million tons of oil a year. If the oil supply is interrupted, the entire American society will stagnate.

However, does this mean that Middle East oil tycoons can raise oil prices without limit?

This is not the case. Instead of endlessly increasing oil prices, the Organization of Petroleum Exporting Countries may even actively increase production, sometimes suppress oil prices, and avoid rising oil prices to the extent that it is not conducive to oil exporting countries.

On the surface, oil prices have risen, and of course, the earnings of oil-exporting countries have also increased. However, if the price of oil reaches a certain level, consumers will consider other alternative methods, such as the use of coal chemical industry to make artificial petroleum, is a very promising method.

Special research has found that when the price of petroleum is higher than a certain level, it is profitable to develop coal chemical industry to produce petroleum. At this time, countries will generally adopt coal liquefaction technology to reduce dependence on petroleum. In order to curb the research and promotion of coal liquefaction technology, the price of oil must be controlled to a certain level in order to protect the long-term interests of oil exporting countries.

Qin Hai’s blow to Vale was also based on this principle. In the case of low iron ore prices, it is not economical to develop Russian iron ore and develop steel instead of plastic. No one is willing to invest in it. However, when the price of iron ore continues to rise and the price of steel exceeds a certain limit, it is feasible to replace steel with plastic. At this time, a large number of institutions will invest human and financial resources for research and development, and there will be a large number of manufacturers. Willing to set up new factories to produce corresponding plastics.

Of course, Vale also understands this truth. When they raise the price of iron ore, they also use the price of plastic as a reference frame to avoid making the price of steel higher than the price of plastic.

however. They miscalculated the Qin Hai variable. In order to compete with Vale, Qin Hai did not hesitate to invest additional funds. It is used for the mining of subway ore in Russia and other countries, as well as the research and development of materials such as plastic steel. According to the current price of iron ore and the cost of plastic production, it is still uneconomical to replace steel with plastic, but if Qin Hai is willing to lose money to promote this kind of thing, there will be no way back for Vale, a huge cost pressure Will make Vale fall into the abyss.

With such a result in mind, of course Qin Hai had enough confidence to negotiate with Callum, and he directly rejected Callum’s offer. It has thrown out such a demanding requirement that the price should not be increased within this year.

“It’s totally impossible!” The first reaction of Jofftz was to jump up and protest. The 20% price increase is already the real reserve price of Vale. If you don’t mention a penny, Vale may even fall into a loss. .

“Mr. Qin, you should know that maintaining last year’s price is an unreasonable requirement, and we cannot agree.” Callum said seriously.

Qin Haidao: “Mr. Callum, Mr. Coffs, you should also know that if you negotiate the first time. You promised to raise the price by only 20%, then everything up to this day will not happen. We will also be very happy to accept this price and maintain good cooperation with your company. “

“But is there any difference between now and then?” Chofts asked.

“Of course.” Qin Hai said, “Do you know how much we have paid for the Dubiago iron ore, Simangdu iron ore, etc.? Also, the research and development of super glass fiber reinforced plastic and many steel products using plastics, we have How much money is invested. All of this is due to the large price increase in Vale. Shouldn’t these additional expenses be borne by Vale? “

“…” Chofts became dumb at once, and he wanted to say Qin Hai a brash word about Brazil, but he was talking. I can’t explain it anyway.

Development of Dubiago iron ore, Simangdu iron ore. The costs are indeed considerable. But why should this money be reimbursed to Vale? There is no research and development of super fiberglass, there is no iron ore negotiations. Do you not develop this technology? Do you dare to be more shameless if you include such expenses in the head of Vale?

However, this kind of words, how can Joeffs say, now man-made sword, I am fish, how dare he easily irritate Qin Hai.

“This condition of Mr. Qin is beyond the bottom line of our company, and I can’t promise you right away.” Callum said. At that moment, he recalled the whole thing and deepened his understanding of Qin Hai. layer. He realized that Qin Hai was a firm-minded man who would never suffer. As he said, he must make money in the Dubiago iron mine and Simangdu iron mine. Otherwise, it will mean a loss in this iron ore negotiation.

Callum believes that if he does not agree with Qin Hai ’s request, Qin Hai is likely to take some crazier actions. In the future, when Vale wants to make peace, Qin Hai will continue to spend these follow-up expenditures generously. Calculated to the head of Vale, the conditions for issuing at that time were not to maintain the original price, and it may have to drop by another 10 percentage points based on the original price.

Can’t fight anymore, this is Callum’s inner feeling. According to Qin Hai’s accounting method, the costs incurred during the friction between the two sides will ultimately be counted on Vale. Who dares to fight this kind of battle?

“Mr. Qin, you may wish to suspend the development of iron mines such as Dubiago. We can resume negotiations and reach a price that is satisfactory to both parties as soon as possible. What do you think?” Callum suggested.

Qin Haidao: “Mr. Callum, to tell you the truth, iron ore is no longer available in our country’s steel companies. How can their iron ore supply be resolved during this negotiation period?”

“We can agree on a temporary price and solve part of the iron ore transaction problem first.” Callum said with anxiety. He didn’t believe that Chinese companies had no iron ore anymore. This clearly shows that Qin Hai is forcing the palace in disguise, but he has no good way to crack it.

“How to fix the temporary price?” Qin Hai chased after him, asking.

“Just an increase from last year …” Callum said.

“I think it’s better to maintain last year’s price.” Qin Hai did not let Callum finish, and said arrogantly.

“Okay … but the total can only be limited to 10 million tons …” Callum said, almost all want to vomit blood.

“Haha, Mr. Callum is really a good friend of our Chinese people. This is really what we need urgently.” Qin Hai nodded with satisfaction.

“This is what we should do …” Callum said helplessly, and then his eyes flashed and he asked meaningfully: “So, what’s Mr. Qin thinking about this forum question?”

Qin Hai pretended to think, and said, “Well, I just thought about it. The full implementation of plastic-replacement steel is also bad for us. So I think we can transfer the corresponding technology to other manufacturers, However, in terms of output, there should still be some restrictions. Xia Gong, you need to adjust the details of the technology transfer, requiring the transferee to only produce according to the output stipulated in the agreement, and the excess fee will be charged at a higher price. “

“I think this is a better technology transfer model.” Callum just complimented just as a stone fell to the ground.

If it wasn’t for the Vale to make concessions, how could Qin Hai be willing to give up the production technology of plastic steel and glass fiber reinforced plastics so cheaply that it was only equivalent to a normal level of 20% of the license fee, and it would be difficult to recover even the R & D costs. Now that Callum has bowed his head, of course Qin Hai must quickly reduce losses. What has been promised in the forum cannot be regretted, but he only said authorization, but did not say authorization quota. For example, I demand that your output cannot exceed 2000 tons a year. Isn’t this requirement excessive? If you are optimistic about the market and want to produce more products, then add it at the 100% license fee.

Callum and his team left China with a gloomy mood, and the Chinese sent a negotiating team to Brazil soon, and began the second round of iron ore negotiations with Vale. This time, Qin Hai did not go in person, but he knew that there was a sword of Damocles hanging on Callum’s head, and he could not play any more arrogance.

The negotiation progressed very smoothly ~ www.mtlnovel.com ~ After several rounds of negotiations, Vale finally set a price of 8.7% higher than last year to determine the supply price to China this year. The two sides also agreed that the price of iron ore for the next year shall not increase by a maximum of 10% on the basis of this year, and the specific price will be determined depending on the international economic situation. After the completion of the negotiations between Vale and China, BHP Billiton also adjusted its iron ore prices this year, only making a slight increase on the basis of last year, which is also within the acceptable range of China.

Just when the good news came from the iron ore negotiations, Pang Yongkun sadly left his office and surrendered the authority of the general manager of Hongyuan Iron and Steel Company. At this time, according to the new organization setting plan, the Economic and Trade Commission has been merged into the Ministry of Commerce, and its power to manage the enterprise has been placed under the newly established SASAC. The central minister made an important speech during the inspection of the SASAC, which specifically mentioned that the state-owned enterprises should bear social responsibilities and directly named Hongyuan Iron and Steel Company, saying that it had performed poorly during the iron ore negotiations and lost the overall situation due to the state-owned enterprises. Concept.

There are very few companies that can be directly criticized by the head. This speech by the head determines the fate of Pang Yongzhang. The provincial government of the Hongyuan Provincial Committee made a decision on the same day, revoking Pang Yongzhang’s position, and found him a peer The upset unit went to retirement.

In the entire steel system, no one cares about Pang Yongzhang’s resignation. Everyone is busy expanding production scale and welcoming a new round of blowouts in infrastructure construction. (To be continued)