Spot iron ore prices touched near nine-month highs and offers remained strong on Tuesday, supported by firm Chinese buying and supply concerns in key producers Brazil and India.
There is market talk that India may lift export duty on iron ore to 20 per cent from 5-10 per cent currently, traders said, further tightening supply from the world's third-largest exporter where a key state Karnataka has already banned shipments since July.
India last raised the export tax on iron ore lumps in April 2010 to 15 per cent from 10 per cent, after slapping a 5 per cent export duty on iron ore fines in December 2009.
Limited supplies from number two exporter Brazil due to massive rains, Chinese stockpiling ahead of the Lunar New Year in early February and concerns over Indian exports could lift spot iron ore prices to $US200 a tonne, a level last seen in 2008, traders said.
Offers for Indian ore with 63.5 per cent iron content climbed to $US186-$US188 a tonne, including freight, on Tuesday, from $US185-$US187 the previous day, according to Chinese consultancy Mysteel.
The three major iron ore indexes, based on Chinese spot prices, on Monday rose to or stayed at their highest since late April 2010.
The Steel Index 62 per cent benchmark jumped 1.4 per cent to $180.80 a tonne, and Metal Bulletin's 62 per cent gauge rose 1.2 per cent to $US176.75.
The Platts 62 per cent iron ore index was steady at $US182.50.
MOL Price at posting:
$1.10 Sentiment: Hold Disclosure: Held
