Iron ore near 2013 peak on China steel demand hopes
Firmer spot steel prices in China, the biggest consumer of both steel and iron ore, are encouraging producers to buy more iron ore amid limited supply of prompt shipments, pushing up prices that have almost doubled since September. Inventories of iron ore at small to medium-sized Chinese steel mills have dropped to about 10-15 days of consumption after the Lunar New Year break from 20-30 days previously, prompting them to restock, said a trader in Rizhao in China's eastern Shandong province.
Traders with iron ore stocks stored at major Chinese ports have increased their prices by 10 yuan to 20 yuan ($1.60-$3.20) per tonne this week, he said.
"I think we're seeing mild restocking because some mills are also hesitating to buy with prices continuing to rise," the trader said, adding he sees prices climbing above $160 but staying below $165 for the rest of February.
Benchmark 62 percent grade iron ore for delivery to China <.IO62-CNI=SI> rose half a percent to $158 a tonne on Tuesday, according to data provider Steel Index.
That is only 50 cents shy of the 2013 high hit on Jan. 8, which was the highest since October 2011.
Prices have rebounded more than 82 percent since hitting a three-year low below $87 in September, pointing to more profit margins for big,
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