B.M.
Well you're going to get a zillion answers - this is almost as hot a button as the spanking or breastfeeding debate!!!!!!
First of all - GOOD FOR YOU that you have established a relationship with her that she felt like she could come and talk to you.
I would start doing a lot of listening.
She already said that she thinks all the other kids are doing it. Ask her if she thinks that a good reason to share her body with someone? Ask her if what she'll do if she gets pregnant? Ask her if she's comfortable enough with this boy to be able to talk about how she likes to be touched and what makes her feel good? Ask her if she's comfortable enough to have a discussion with her partner about who else her partner has had sex with and whether or not he's been tested for STD's on a regular basis? Ask her if her partner will use a condom even if she is on the pill (or what form of birth control THEY have decided together they will use that will prevent BOTH pregnancy and STD's). Ask her what she will do if her partner doesn't want to put on a condom and they are both naked - how will she handle that? Ask her how she intends to pay for birth control? Ask her how she intends to pay for annual exams to the gyn to get tested for STD's now that she is sexually active? (OK - these last 2 are iffy - you don't want her think she doesn't have access to these.... but you want to get her thinking about all the responsibilities that go along with having sex).
One additional question - who is she 'ready' to have sex with? Does she have a boyfriend? How long have they been dating? How old is he?
I wouldn't ask her these questions in an accusatory manner - but let her know that these are decisions she needs to be comfortable making before she is 'truly' ready to have sex.
This is a toughy - good luck!