In this world, there is no absolute buyer's market or seller's market, and there is a balance between buyers and sellers, and no one side can maintain absolute superiority.

Take the oil market, for example:

It is not an exaggeration to say that oil is the blood of modern industry. A country like the United States consumes more than 600 million tons of oil a year, and if the oil supply is interrupted, the entire American society will come to a standstill.

However, does this mean that the Middle East oil tyrant can raise the price of oil without limits?

This is not the case, and instead of endlessly raising oil prices, the Organization of the Petroleum Exporting Countries (OPEC) has even taken the initiative to increase production in some cases to suppress oil prices and prevent them from rising to the detriment of oil-exporting countries.

On the face of it, when oil prices rise, so do the revenues for oil-exporting countries. However, if the price of oil is high to a certain extent, consumers will consider other alternatives, such as the use of coal chemicals to make artificial oil, which is a very promising approach.

OPEC has a special study and found that when the price of oil is higher than a certain level, it is profitable to carry out coal chemical production of oil, and then countries will generally adopt coal liquefaction technology to reduce their dependence on oil. In order to curb the research and promotion of coal liquefaction technology, OPEC must control oil prices within a certain level to protect the long-term interests of oil-exporting countries.

Qinhai's attack on Vale is also based on this principle. With the low price of iron ore, it is uneconomical to develop iron ore in Russia and to replace steel with plastic, and no one will be willing to invest in it. But when the price of iron ore continues to rise, so that the price of steel exceeds a certain limit, it is feasible to replace steel with plastic, at this time, there will be a large number of institutions to invest human and financial resources in research and development, and there will be a large number of manufacturers willing to build new factories to produce the corresponding plastics.

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

However, they missed the variable of Qin Hai. In order to compete with Vale, Qin Hai did not hesitate to invest additional funds for the mining of metro ores in Russia and other countries. and the research and development of materials such as plastic steel. Based on 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, then Vale has no way back, and the huge cost pressure will make Vale fall into the abyss.

Counting such a result, Qin Hai certainly had enough confidence to negotiate with Callum, and he directly rejected Callum's offer, throwing out such a harsh requirement that the price should not be increased within this year.

"It's completely impossible!" Joftz's first reaction was to jump up and protest, and the 20% price increase was already Vale's real floor price. If you don't mention a penny, Vale could even fall into the red.

"Mr. Qin, you should know that maintaining last year's price is an unreasonable request, and it is impossible for us to agree to it." Callum said solemnly.

Qin Haidao: "Mr. Callum, Mr. Joftz, you should also know that if it is in the first negotiation. You promised to raise the price by only 20%, so everything up to today. None of this will happen, and we will be very happy to accept this price and maintain good cooperation with your company. ”

"But is there any difference between now and then?" Jofts asked.

"Absolutely." Qin Hai said, "Do you know how much money we have paid for the Dubias Iron Mine, the Simandou Iron Mine, and so on? Also, how much money have we invested in the research and development of super FRP and many plastic steel products. All of this. All of this is due to the sharp increase in prices in Vale. Shouldn't Vale bear these additional costs? ”

"......" Jofts was dumb all of a sudden, he wanted to say a Brazilian national scold to Qin Hai, but when the words came to his lips, he couldn't say it anyway.

Development of the Dubias iron ore mine. The cost of developing the Simandou iron ore mine is indeed very considerable. But why should Vale reimburse the money? What else is the research and development of super FRP, is there no iron ore negotiation, you will not develop this technology? Do you dare to be more shameless when you put such a fee on Vale?

However, how can Jofts say this, now that people are swordsmen and I am fish and meat, how dare he easily provoke Qin Hai.

"Mr. Qin's condition is beyond our company's bottom line, and I can't agree to you right away." Callum spoke, and at that moment just now, he recalled the whole thing, and his understanding of Qin Hai deepened again. He realized that Qin Hai was a strong-willed person who would never suffer losses, as he himself said, he had to earn back the investment in Dubias Iron Mine, Simandou Iron Mine and other places, otherwise it would mean that he would suffer a loss in this iron ore negotiation.

Callum believes that if he does not agree to Qin Hai's request, Qin Hai may take some more crazy actions, and when Vale wants to make peace in the future, Qin Hai will still generously calculate these follow-up expenditures on Vale, and at that time, the conditions offered will not be to maintain the original price, and maybe it will be reduced by 10 percentage points on the basis of the original price.

Can't fight anymore, that's how Callum feels inside. According to Qin Hai's accounting method, the costs incurred during the friction between the two sides will ultimately be counted on Vale, who would dare to fight this kind of battle?

"Mr. Qin, you might as well suspend the development of Dubias and other iron ore mines first, and we can restart negotiations and reach a mutually satisfactory price as soon as possible, what do you think?" Callum suggested.

Qin Haidao: "Mr. Callum, to tell you the truth, our country's iron and steel enterprises are now out of iron ore, how can their iron ore supply be solved during this period of negotiations?" ”

"We can agree on a provisional price to solve some of the iron ore trading problems first." Callum said with shame. He didn't believe that Chinese companies had no iron ore anymore, which was clearly Qin Hai forcing the palace in disguise, and he had no good way to crack it.

"How will the provisional price be determined?" Qin Hai took advantage of the victory to chase and asked.

"That's ...... more than last year," Callum said.

"I think it's better to maintain last year's price." Qin Hai didn't let Callum finish speaking, and said domineeringly.

"Okay...... But the total amount can only be limited to 10 million tons......" Callum said, almost vomiting blood.

"Haha, Mr. Callum is really a good friend of our Chinese people, this is really urgent for us." Qin Hai nodded in praise with satisfaction.

"This is what we should do......" Callum said helplessly, and then, with a flash of his eyes, he asked meaningfully, "So, what is Mr. Qin's consideration regarding the issue of this forum?" ”

Qin Hai pretended to think and said, "Hmm, I thought about it just now, and the full implementation of replacing steel with plastic will also have an adverse impact on us. So, I think that although we can transfer the technology to other manufacturers, there should be some restrictions in terms of output. Xia Gong, you go and adjust the details of technology transfer, requiring the transferee to only produce according to the output specified in the agreement, and the excess part must be charged a higher price licensing fee. ”

"I think it's a better model for technology transfer." Callum gave a fitting compliment, and at the same time a stone fell to the ground in his heart.

If it weren't for the sake of forcing Vale to make concessions, how could Qin Hai be willing to give up the production technology of plastic steel and FRP so cheaply, which is only equivalent to 20% of the usual level of licensing fees, and it is difficult to recover even the cost of research and development. Now that Callum has lowered his head, Qin Hai must of course hurry up to reduce his losses. You can't go back on what has been promised on the forum, but you only said the authorization, but you didn't say the quota of the authorization. For example, I ask you to produce no more than 2,000 tons a year, isn't that too much? If you are optimistic about the market and want to produce more products, then add 100% of the license fee.

Callum and his entourage left China in a depressed mood, and the negotiating team sent by the Chinese side soon rushed to Brazil again to start a second round of iron ore negotiations with Vale. This time, Qin Hai didn't go in person, but he knew that there was a sword of Damocles hanging over Callum's head, and it was impossible for him to be arrogant anymore.

The negotiations went smoothly, and after several rounds of negotiations, Vale finally set the price of this year's supply to the Chinese side at an 8.7% price increase compared to last year. The two sides also agreed that next year's iron ore price will not increase by up to 10% on the basis of this year, and the specific price will depend on the international economic situation when the time comes. Following the conclusion of Vale's negotiations with the Chinese side, BHP Billiton has also adjusted its iron ore prices this year, with only a slight increase from last year, which is also within the acceptable range of the Chinese side.

Just when the good news came from the iron ore negotiations, Pang Yongfu left his office gloomily and handed over the authority of the general manager of Hongyuan Iron and Steel Company. At this time, according to the new institutional establishment plan, the Economic and Trade Commission had been merged into the Ministry of Commerce, and its authority to manage enterprises was transferred to the newly established State-owned Assets Supervision and Administration Commission. During his inspection of the SASAC, the head of the central government made an important speech, in which he specifically mentioned that state-owned enterprises should assume social responsibility, and directly named Hongyuan Iron and Steel Company, saying that it had behaved badly during the iron ore negotiations and had lost the overall concept that state-owned enterprises should have.

There are very few enterprises that can be directly named and criticized by the chief, and the chief's speech decided the fate of Pang Yongfu, and the Hongyuan Provincial Party Committee and Provincial Government made a decision on the same day to remove Pang Yongfu from his post and find him an unpopular unit of the same level to retire.

In the entire steel system, no one cares about Pang Yongfu's departure, and everyone is busy expanding the scale of production to meet a new round of infrastructure blowout. (To be continued......)