Iron Ore Faces Supply Problem in Brazil, Rising Demand in China

China's steel industry absorbs 70 percent of global transoceanic iron ore, and its control over world consumption is growing.

RIO DE JANEIRO, BRAZIL - Brazil again plays a key role in setting the direction of global iron ore prices, since the country, the second-largest global producer, accounts for a significant share of supply. But as soon as the supply shock subsides, the market's fate will hinge on China's still fragile economic rebound.

The main steel ingredient has been traded at over US$100 (R$520) a ton since late May, driven by the ban on Vale's mining complex in Itabira, which accounts for ten percent of the company's production. In addition, China produces steel in . . .

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