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High-grade iron ore may spike to $US100 a metric tonne as China intensifies a clampdown on pollution by restraining industrial activity. Quentin Jones
by Krystal Chia
High-grade iron ore may spike to $US100 a metric tonne as China intensifies a clampdown on pollution by restraining industrial activity, adding further momentum to a trend that's reshaped the global market in recent years and driven buyers in Asia's top economy seek out better-quality material.
After sinking in March, top-quality ore with 65 per cent iron content gained every month, hitting $US91 a ton on Friday, and keeping it in positive territory this year even as global trade frictions mounted, according to Mysteel.com. In contrast, benchmark 62 per cent ore has flat-lined in the $US60s, and is down 14 per cent. The divergence has exploded the gap between the two.
"Short-term spikes to this level are entirely possible in response to Chinese production and policy announcements," said Paul Gray, vice president for iron ore markets at Wood Mackenzie, referring to the $US100 mark for top-grade prices.
GBG Price at posting:
1.8¢ Sentiment: Buy Disclosure: Held
