The market for steel-making commodities used to be priced based on fixed prices on a term basis, but that is changing, reports CNBC. The practice among Chinese traders of sourcing from non-traditional exporters on an ad hoc basis has pushed iron ore trading towards shorter contract terms and spot-pricing mechanisms. Chinese traders have had no problem breaking term contracts when prices drop by paying a fine and procuring spot cargos.
China is also having a huge impact on food, as their consumption habits change. Already the world’s largest soybean importer, China’s appetite for non-traditional food products such as olive oil and avocado is skyrocketing, opening the door for new opportunities. Concern regarding food safety is also driving interest in agricultural products from New Zealand.
“We see the Australian and New Zealand markets setting the tone for the rest of the world when it comes to integrity, safety and quality of food supply chains,” Maggie Zhou, Alibaba’s Australia and New Zealand managing director was quoted by Reuters as saying. “It was a natural decision to pilot a programme here.”
Finally, if China’s rhetoric is any sign of things to come, changing energy habits will also have a huge impact. Air pollution problems continue to plague China, and weaning off of coal will be huge part of sparing lungs in the country. But, despite pledges to eventually transition to more ecological energy sources, it is not going to happen overnight.