THE iron ore price rally may be heading for a breather owing to a potential increase in supply from Brazil, said Bloomberg News.
Brazilian producers are looking to generate cash and make new investments to supply a tight market underpinned by robust China-led demand, said the newswire citing the country’s mining industry group Ibram.
This comes as steel mills in China are ramping up production to benefit from elevated prices, with the nation churning out crude steel, putting China on track for record output this year. In another sign of strong demand, stockpiles for rebar continued to drop, while iron-ore port inventories declined for the third consecutive week, said Bloomberg News.
Iron ore futures in Singapore rose 2.8% to $213.25 a ton after climbing 2.9% on Monday. Contracts in Dalian jumped as much as 4.9%, and rebar and hot-rolled coil futures edged higher in Shanghai, said Bloomberg News.
