Iron ore price near $US100 as supply tightensJuly 28, 2009 -...

Iron ore price near $US100 as supply tightensJuly 28, 2009 - 3:34PM .
Spot iron ore prices in China, the world's biggest consumer, are approaching $US100 a tonne due to tight supply from Australia and India, two trade sources said today.

Some merchants are asking $US100 a tonne for Indian ore of 63/63.5 per cent iron content for one-month delivery, they said, adding that no such deal had been concluded so far and almost all trades had been reached at $US98 a tonne on Tuesday.

"Supply is tight. Australian ore deliveries are declining due to deadlocked iron ore price negotiations, while Indian ore transportation has slowed due to the rainy season there," said a trader based in eastern China's Zhejiang province.

Annual term iron ore price negotiations between Chinese steelmakers and miners, including BHP Billiton, Rio Tinto and Brazil's Vale, have degenerated this year into an international row, with China alleging that Rio Tinto employees were involved in spying and bribing Chinese officials.

China's de facto negotiator, the China Iron and Steel Association, has been insisting the country deserved a better price than others because it is the world's top buyer of the steel-making input.

Reuters