Fewer supplies of high-grade iron ore kept offers firm on Thursday as forward swaps rose in anticipation of further price gains.
"Indian ore has been in tight supply. They have not been shipping as much ore to China as before. I don't think inquiries are rising on our end, but prices are firming though," said an iron ore trader in Shanghai. Supply of Indian ore with iron content above 60 percent has been tight since the southern state of Karnataka banned iron ore exports from late July in a crackdown on illegal mining. Shipments from Karnataka comprise around a quarter of exports from the country, the world's third-largest supplier.
Iron ore exporters in the state have challenged the ban and the Karnataka High Court is expected to announce a ruling soon after holding several hearings. "For 63.5/63, there is a gulf between prices offered," said the Shanghai trader. "We've heard prices being closed at crazy levels like $163, but there are also offers and deals at $157-158 levels, which feels more grounded."
"I think the Indian miners are holding out for high prices because some large traders have been willing to pay for them."
Source: Reuters
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