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Archive for the ‘Iron Ore’ Category

Real Women Prefer Iron Ore

I’d rather have a few hundred thousand tons of iron ore than any precious stone.   I learned that back in 2007 when I was a mandate for a Brazilian iron ore mine.  One of China’s top three steel producers wanted our  iron ore, and at five months pregnant I flew out to Beijing to start the negotiations.  I set the meeting up in one of Beijing’s nicest hotels  and hoped that my protruding belly did not distract the purchasers from the main discussion.  It did not — my skin color did.

The two purchaser representatives, both of whom I had several phone conversations with prior to the meeting shook my hand in unabashed r.  They smiled nervously and  the shock eventually wore off after some small talk.  They smoke and drank tea the entire meeting, expressed some interest in the iron ore, but questioned its existence as a negotiation tactic. 

This is typical Chinese negotiation 101.  Of course they knew we had the iron ore, or else they would not have wasted their time meeting with me.  But the iron ore industry at the time was booming and China was desperate to get better prices on iron ore, from a supplier other than the then CVRD.   How do you get better prices when people know that you are in desperate need of supply?  Trick the supplier into thinking that you doubt his ability to supply. 

In the end we provided a lower price, but they didn’t bite.  Why?  Because if the price is that low, it must be too good to be true.

The iron ore industry is still very exciting and a $1.00 commission from a 1.6 million ton iron ore contract is a lot of money.   So for me, keep your diamonds — I prefer iron ore.

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