Steel mills feel the heat in ore talks as output peaks

Crude steel production in China, the world's largest steel maker, rose 14 percent to a record last year, further complicating this year's iron ore negotiations.

Steel output rose to 568 million tons in 2009 from 500 million tons in 2008, the National Bureau of Statistics said in a statement yesterday.

The output surge has also fueled demand for raw materials. This would further strengthen the hands of the three big miners in this year's iron ore negotiations, said Hu Kai, an analyst with consulting firm Umetals.