Iron Ore Key Indexes Steady at 8 Month Highs.

Reuters reported that Asian spot iron ore prices remained firm recently propped up by demand from top buyer China and concern those global supplies could tighten if severe floods in Australia disrupt exports.

Commonwealth Bank of Australia said in a note that the Australian Bureau of Meteorology latest three-month outlook shows up to 70% chance of above median rainfall across the iron-ore producing Pilbara region of Western Australia.

The bank said "A large rainfall could impact iron ore supply in the months ahead and support prices above already high levels. Australia is the world's biggest exporter of the steelmaking ingredient.”

Northern Australia flood stricken coal industry braced for prolonged shutdowns on Thursday when London-listed miner Anglo American said it could take weeks to drain its pits and resume digging. Australia accounts for more than half of global exports of coking coal also a key raw material in making steel.

Traders said Indian ore with 63.5% iron content remained on offer in China at above USD 180 a tonne including freight.

An iron ore trader in Rizhao in China eastern Shandong province said "Many Chinese steel mills are still stocking up for the Lunar New Year holiday next month, so there still room for prices to increase, adding he saw an offer as high as USD 183 a tonne but no takers so far.”

He added that "There are less deals for high-grade ore because prices are really high. He also said lower grade Indian ore with 55% iron content was recently sold at USD 120 per tonne, including freight and offers for that grade could rise to USD 123 to USD 125 this week.”

Fewer available cargoes of high grade ore from India which sells most of its material in the spot market had kept supplies tight and supported iron ore prices hovering at eight-month highs.

Source : steelguru.com