China launched its first physical iron ore trading platform Monday in Beijing in an effort to strengthen its pricing power of a commodity for which the nation is the world's largest buyer.

The online platform was launched by the China Beijing International Mining Exchange in partnership with the China Iron and Steel Association and the China Chamber of Commerce of Metals Minerals & Chemicals Importers & Exporters.

Major steel makers, including Baosteel Group and Hebei Iron & Steel Group, and trading companies have agreed to join the platform. The Exchange said the platform will not develop iron ore derivatives like swaps and futures because it wants to reflect actual buying and selling prices.

China is the world's biggest buyer of iron ore, accounting for 60 percent of the global trade by volume. Supplies are currently dominated by Australia's BHP Billiton and Rio Tinto and Brazil's Vale. Earlier the China Iron and Steel Association published an iron ore index as a guide for domestic importers.

Wang Xiaoqi, vice chairman of the CISA, said the platform will welcome foreign steel makers, iron ore producers and traders to take part.

Source:china.org