Chapter 305: Steel Companies Are Flocking to You
Zhu Youxin was sitting right in the center of the crowd.
He hadn't expected Bao Yanyao to specifically highlight Hualing Steel's cooperation with Lianying Mining. Bringing it up in front of so many steel industry executives seemed to imply a deeper intention. Now, naturally, everyone's attention was firmly fixed upon him.
"President Zhu, your Hualing Steel signed a ten-year supply contract with Lianying Mining so early—did you anticipate the sharp price hike from this year's iron ore negotiations?"
"What's the contract price like? Is it a fixed rate similar to this year's long-term contract price, around forty US dollars per ton?"
"How's the quality of Lianying Mining's iron ore? Does it meet the general blast furnace requirements in our domestic steel mills?"
"You really got ahead of the curve, President Zhu!"
Most attendees were acquainted with each other, even if they hadn't directly cooperated. Zhu Youxin from Hualing Steel was particularly well-known in these circles. Hearing that his company had swiftly secured a decade-long supply deal with Lianying Mining sparked everyone's curiosity.
Clearly, securing such a long-term contract could offer tremendous stability for future operations, assuming the cooperation proved successful.
Zhu Youxin considered this deal just an internal decision at Hualing Steel and hadn't intended to make it public. Yet now, it had become common knowledge, and everyone seemed eager to know more details.
"Yes, we did recently sign a contract with Lianying Mining," he confirmed modestly to those around him.
"Lianying Mining is only a junior exploration company. Their plans for mine construction are essentially just conceptual at this stage. Frankly, signing a contract and paying a significant upfront fee at this point is indeed risky."
"Looks like you've done your due diligence and think it's worth the gamble. What's your honest assessment of this company?"
"Did they offer you any special discounts?"
Faced with these inquiries, Zhu Youxin merely nodded politely, without revealing much detail. If he shared too much information, others might rush into similar investments and potentially blame him if things went wrong.
Bao Yanyao didn't intervene in the private conversations occurring near Zhu, nor did he offer further explanations. Instead, he simply declared the meeting concluded.
The meeting had been relatively brief, effectively communicating the results of this year's iron ore price negotiations. Moreover, subtly and explicitly, it served as a warning to domestic steel companies that changes were urgently needed.
The era when foreign iron ore suppliers offered cheap iron ore was gone for good. Pricing power now firmly rested with the three global iron ore giants. This year, they dared to increase prices by 70%; what about next year? And the year after that?
Without taking proactive measures, the future of over a thousand domestic steel enterprises would ultimately be at the mercy of these international suppliers. Recent prosperity in the domestic steel industry had largely depended on supportive government policies and economic growth. But once policies tightened, the thin profit margins would vanish entirely.
This concern wasn't unfounded. Statistics from the Steel Association indicated many new steel plants had emerged recently, creating intense competition. Coupled with relentless price increases from international iron ore suppliers, the industry faced uncertain prospects.
Industry insiders even feared mass bankruptcies among steel companies if the situation deteriorated.
The steel industry appeared prosperous now, yet the Steel Association, as a coordinating body, had already detected underlying risks.
From the perspective of individual steel companies, particularly smaller ones, their priority remained making immediate profits rather than worrying about long-term trends. With iron ore contract prices rising significantly next year, would spot market prices follow suit?
Securing iron ore supplies at long-term contract prices had become a top priority.
Global iron ore production capacity was relatively fixed, difficult to significantly increase in the short term. Demand, however, continued to grow in North America and Europe. This meant the quantity of iron ore available for China's steel industry at long-term contract prices was limited.
Whoever secured these contracts first gained a critical cost advantage. Companies forced to purchase high-priced spot iron ore, like this year, would struggle.
Thus, immediately after the meeting, many steel executives rushed to contact China-based executives from major iron ore suppliers like Li Tuo and BHP Billiton, seeking favorable contracts.
For most smaller steel enterprises, directly investing in exploration or acquiring mining companies was an unrealistic dream. Lianying Mining had presented an ideal vision, but that future was still far from realization.
However, major players like Haigang Steel, Shagang Group, and Fengli Group viewed matters from a different perspective. They unanimously recognized Lianying Mining's enormous potential.
As Lu Chenyi reached the parking lot, his assistant rushed over, reporting with some disappointment, "We couldn't reach Li Tang directly. Litang Prosperity Holdings said he's currently overseas."
"Which country?" Lu Chenyi urgently wanted to meet Li Tang ahead of others, even if it required traveling abroad himself.
"Guinea, in Africa."
"Africa?" Lu reconsidered and ultimately dismissed the idea of traveling there himself. "What's he doing there?"
"They mentioned a geological exploration project but didn't provide further details."
"Keep trying to contact Li Tang regularly. Maintain good relations with Litang Prosperity Holdings. The moment he returns, we must meet him first!"
"I'll keep a close watch."
Inside the car, Lu glanced at his watch; it was still early. He instructed the driver, "Let's visit Wukuang Group."
Arriving at Wukuang Group's headquarters, he encountered Niu Fu, who had just returned from the same Steel Association meeting.
"Chairman Lu, your visit brightens my humble office," Niu Fu welcomed him warmly.
"Chairman Lang isn't here?" Lu asked. Unlike Lu's dual role at Haigang Steel, Wukuang's Chairman Lang managed strategic matters separately.
"He's meeting senior officials this afternoon," Niu Fu explained, gesturing for Lu to sit and enjoy tea.
Without further pleasantries, Lu directly addressed his visit's purpose. "If not for Chairman Bao mentioning it at the meeting, I wouldn't even know Wukuang Group is a major shareholder of Lianying Mining!"
Niu Fu unexpectedly revealed a satisfied smile. Typically stern and reserved, he rarely showed visible emotions. But the investment in Lianying Mining now stood as the perfect example of Wukuang Group's bold overseas expansion, achieved effortlessly—almost accidentally.
"To tell you the truth," Niu Fu explained, sipping his tea, "when Li Tang decided to invest in an iron ore project in Australia and acquired a listed junior exploration company, it was nearly bankrupt."
Lu listened intently, genuinely curious. "Yet you followed his lead?"
"Initially, we didn't join. Li Tang bought the company himself and invested heavily into exploration, discovering viable iron ore reserves. But when the company needed an additional 100 million Australian dollars for further development, Li Tang didn't have enough cash, so he approached Wukuang Group and Shenxia Group."
Mentioning Shenxia Group, Niu added casually, "Li Tang is dating Li Xingchao's daughter, so relations between their families are excellent."
"Oh, is that so?" Lu was unaware of this connection.
"They've been dating for a while," Niu nodded.
"So, you invested because he found iron ore reserves?"
"This was two years ago, and iron ore prices were still depressed. To be honest," Niu reminisced, "I didn't see any potential in Li Tang's iron ore project back then. Huge investment, uncertain returns. Even Li Xingchao agreed."
"But you invested anyway?"
"Li Tang has a deep history with Wukuang Group…"
"You jointly discovered the Talege copper-gold mine, now under development—a major national project," Lu noted with admiration.
Niu acknowledged, "We had some spare cash, around two hundred million yuan. We discussed it internally and decided to invest one hundred fifty million. Shenxia Group contributed fifty million, supporting Li Tang's initiative."
"You didn't foresee the iron ore market would boom like today?" Lu had presumed Niu was exceptionally insightful.
"Who could've guessed!" Niu shook his head, amazed at the market's sudden transformation. "Back in 2002, domestic iron ore mines were closing down, completely unprofitable."
"It was indeed the darkest period for iron ore production from the '90s to the early 2000s," Lu acknowledged, having witnessed it himself.
"But one man saw a bright future amidst that darkness!"
"Li Tang?" Lu guessed immediately.
"Exactly!" Niu confirmed, recalling vividly how a younger Li Tang once confidently predicted an imminent mining industry boom. Iron ore, copper, molybdenum—each had now entered an unprecedented period of growth, exactly as Li had anticipated.
"Industry is the engine of economic development, and mineral resources fuel that engine!" Lu declared passionately. He then sincerely proposed, "Since Wukuang Group co-owns Nanyang Investment, which controls Lianying Mining, why don't you sell Nanyang Investment to Haigang Steel?"
"No chance," Niu refused instantly, without hesitation.
"You don't operate steel mills!"
"But we have an import-export trading subsidiary."
"You heard others accusing your trading company of inflating iron ore prices, blaming you for this year's skyrocketing negotiations."
"Such accusations are defamatory," Niu firmly retorted. "We have legal import-export rights. By buying iron ore internationally, we help smaller domestic mills without such rights. This is charity, yet we face slander!"
Lu smiled at Niu's unapologetic defense, clearly determined. "Then allow us to buy into Nanyang Investment."
Given today's soaring iron ore prices, everyone recognized the boundless potential awaiting those who moved decisively into iron ore investment.
Niu Fu carefully thought it over. If Lianying Mining had a partner like Haigang Steel, future sales pressure for iron ore would significantly diminish.
Although the iron ore market had recently become red-hot, such a situation was unusual and typically fleeting. Most of the time, iron ore producers faced considerable pressure to find buyers for their ore.
Mining giants such as Hamersley Vale, BHP Billiton, and Rio Tinto had all strategically invited steel producers, like Nippon Steel and Posco, to invest in their mining projects, precisely to alleviate selling pressure. Unless the steel industry maintained consistently strong demand—like the last two years—the challenge of selling ore remained ever-present.
"Personally, I have no objections," Niu Fu said diplomatically, not wishing to embarrass anyone in front of others. "But when we first invested in Nanyang Investment, we never imagined Lianying Mining would grow to today's scale. Back then, after raising 100 million Australian dollars, Lianying Mining's valuation was still under 150 million Australian dollars. Now, their market cap is approaching a billion Australian dollars!"
"They've indeed grown incredibly fast," Lu Chenyi acknowledged, observing closely.
"When we invested, we signed an agreement with Li Tang, adopting a unanimous decision-making system on all significant matters regarding Lianying Mining. In other words, Li Tang has the final say," Niu Fu explained. In fact, over the years, Niu Fu had never interfered with Lianying Mining's operations. Shenxia Group had followed the same hands-off approach.
Their initial investment of 200 million yuan had purely been to support Li Tang through financial difficulties. At the time, neither Wukuang nor Shenxia had been particularly optimistic about iron ore's future. The investment had been based purely on trust and goodwill toward Li Tang.
"So we still have to wait for Li Tang's return to discuss anything further?" Lu Chenyi was somewhat disappointed, having expected to finalize a preliminary agreement with Niu Fu.
"No idea when that kid will be back," Niu Fu leisurely sipped his tea, clearly enjoying the situation.
Watching other steel companies frantically scramble gave him a peculiar sense of detached amusement.
"What's Li Tang doing in Guinea, Africa?" Lu Chenyi asked curiously.
"Iron ore project. He started it last year."
"Iron ore again?" Lu's interest piqued even further.
"But don't get your hopes up too high," Niu Fu advised. "Honestly, I suspect Li Tang's Guinea iron ore project isn't purely business—it's probably personal. He's likely doing it just to spite Rio Tinto, acting impulsively out of revenge."
"What do you mean?" Lu pressed further.
"He managed to snatch an exploration right from Rio Tinto," Niu Fu smiled faintly at the memory. "Probably a retaliation against Rio Tinto—settling a personal grudge. Young men tend to act on impulse."
"What's his issue with Rio Tinto?" Lu Chenyi felt puzzled, wondering how someone could challenge such a global giant. In exploration circles, Li Tang certainly stood out as exceptionally talented. Still, against a behemoth like Rio Tinto, the difference in scale was simply immense.
"This isn't really a secret," Niu Fu continued. "When we applied for the Talege copper-gold mining rights, Rio Tinto secretly tried to sabotage us, hoping to grab the rights themselves. Li Tang likely also faced conflicts with Rio Tinto in Australia."
"Yet Lianying Mining signed a transport agreement with Rio Tinto, seemingly on good terms," Lu remarked, confused.
"Business cooperation is separate from personal grudges," Niu Fu shrugged. He believed Li Tang's move to seize exploration rights from Rio Tinto in Guinea was unnecessary. "Young people often act impulsively."
"How old is Li Tang?" Lu suddenly felt momentarily dazed.
"Around twenty-five or twenty-six."
"Younger than my son!"
…
Zhu Youxin felt that since he was already in Yanjing and had a cooperative relationship with Li Tang, he should visit him at the Cloud Top Building. Upon arrival, however, he discovered a surprising number of other visitors also waiting to see Li Tang.
Due to his previous visits for contract signings with Fred, Zhu was already acquainted with Dai Yingchi and received a warm welcome. Sitting in Dai's office, he pointed to the waiting area outside and asked curiously, "What's going on here?"
"All steel company representatives here to discuss cooperation with Li Tang," Dai Yingchi explained while serving tea, clearly perplexed by the situation. "I honestly don't know what's happening—suddenly, many people showed up, insisting on seeing Li Tang."
Zhu Youxin sipped the tea appreciatively, nodding calmly, "Not surprising."
"I told them Li Tang is abroad and won't be back anytime soon, promising I'd inform them once he's back. But look at them—they'd rather sit there and wait." Dai looked genuinely troubled. He couldn't simply send them away, knowing representatives from well-known companies like Shagang Group and Fengli Group were among them.
"Li Tang's still in Africa?" Zhu knew Li Tang was in Guinea.
"Yes. I already contacted the Simandou Iron Ore office there to relay the situation, hoping Li Tang decides to return soon."
As they chatted, Shen Wenhua and Wu Yueming passed by and noticed Zhu inside. They entered cheerfully.
"President Zhu enjoys special privileges as a business partner!" Shen Wenhua teased.
"Come, join us for tea," Zhu warmly invited them. Introducing the two new arrivals to Dai, he said, "This is President Shen from Shagang Group, and President Wu from Fengli Group—both major tycoons from Jiangnan Province!"
"We can't compare to President Zhu's carefree style!" Shen laughed good-naturedly.
Wu Yueming, noticing Zhu and Dai's relaxed demeanor, assumed they'd contacted Li Tang and asked directly, "When will Li Tang arrive? Let's all have dinner together tonight!"
"I wasn't lying—Li Tang is genuinely in Africa," Dai Yingchi insisted, standing tall but appearing slightly aggrieved. Clearly, these powerful guests weren't easy to handle.
"He really is in Africa," Zhu confirmed.
"It seems we won't meet Li Tang today after all," Shen Wenhua sighed disappointedly.
Ever practical and down-to-earth, Wu Yueming laughed and proposed cheerfully, "Since Li Tang isn't here, Minister Dai, tonight you can represent him. Let's treat you to a good meal!"
Dai Yingchi felt overwhelmed by their sudden enthusiasm. Surrounded by influential steel executives, he humbly declined, "Shouldn't we wait until Li Tang returns?"
"No way, we can't wait! It's nearly quitting time—let's find a good place now!" Shen enthusiastically supported Wu's idea. Cultivating good relations with Dai could open doors to cooperation with Li Tang later. They also intended to coax details of Zhu's recent contract over drinks, hoping it included favorable long-term pricing—potentially a huge advantage.
"There's a restaurant downstairs," Dai suggested modestly.
"We can't have you treating us!" Wu immediately objected.
Shen turned to his assistant decisively, "Book the garden restaurant we visited last time, quickly—otherwise, they'll be fully booked."
…
Receiving an urgent message from home, Li Tang left Guinea's Nzérékoré region, enduring a grueling 600-kilometer journey on rough dirt roads back to Conakry, the capital.
In Conakry, five beachfront villas he'd previously purchased were now converted into offices and dormitories for Simandou Iron Ore Company after simple renovations and furniture additions. Though he'd hired some local staff, numbers remained small, and the space was sufficient.
Most of inland Guinea lacked mobile coverage. Immediately upon returning to Conakry, Li Tang called Dai Yingchi.
"President Li, your phone finally connected!" Dai exclaimed with evident exhaustion and weariness.
"Are you hungover?" Li Tang detected Dai's fatigue and amusement.
"You weren't here, and those steel bosses made me drink your share. I still feel sick thinking about it. I don't even know how I ended up in a hotel last night. My girlfriend nearly went ballistic when she found out I'd slept at a hotel," Dai complained bitterly.
"Zhu Youxin made you drink?" Li Tang found it amusing but understandable.
"President Zhu was fine. It was those two tycoons from Jiangnan Province—extremely wealthy and formidable drinkers. Next time, you handle them yourself. I can't handle two people's drinking alone!"
"Which tycoons?" Li Tang laughed openly.
"President Shen from Shagang Group and President Wu from Fengli Group."
"What did they want?"
"Negotiations ended; iron ore prices shot up over 70%. They didn't discuss work much last night, but I think they're eyeing our Lianying Mining iron ore project."
"Oh—" Li Tang finally understood.
"Apart from those tycoons, many steel executives came yesterday, desperate to see you directly. Today, others returned again, eager to meet. The steel industry is flocking to you."
"I'll finish arrangements here and return shortly," Li Tang realized the rising iron ore prices meant it was the perfect time to promote Lianying Mining aggressively.
"When will you return? I'll inform them."
"In three to five days."
"Okay."
"Contact Alice or He Runqi; have them return first to talk to these steel executives," Li Tang instructed. He knew the key to Lianying Mining's future hinged on securing support from domestic steel enterprises.
"Understood."
Ending the call, Li Tang smiled confidently. At last, the iron ore market had reached a point of promising opportunity.
As Li arranged the remaining exploration tasks, Fazini approached with a familiar-looking man, introducing him with a smile, "Frando from Ghana."
Frando, with his long, horse-like face, slicked-back hair, and ever-present cigar, was unmistakable.
"Mr. Frando, we shared cigars once before—in Kulun, Mengguo," Li Tang greeted warmly.
"Indeed, it's been a long time," Frando nodded, settling comfortably into a seat by the villa overlooking the serene coastline.
Lighting up a cigar, Frando smiled at Li Tang, "Seeing you again here is quite fortunate. I came specifically because I have some business to discuss with you today."
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