Expectations of higher benchmark iron ore prices are rising with the rumour that Brazillain mining giant Vale has pitched a massive 70 per cent price increase at Chinese negotiators.
Such a rise would replicate the 71.5 per cent rise in 2005-06 when the market was caught short by iron ore suppliers badly underestimating the extent of China,s soaring steel production and consequent iron ore demand.
The spot market has been trading at more then double the current delivered contract price, but a price increase of 70 per cent is seen as probably an opening gambit from the Brazilans. Territory is sending one ship a month to China and this is already being ramped-up, the company plans to spend
$ 10 million this year on drilling, there is every possability
by years end it could be a ship a-week now that would make the share price bounce just like a bad cheque.
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