Iron ore price has jumped

Iron ore is up $ 45.60 a tonne this week, according to Steelindex. Steelmaking raw materials have gained 6.3 percent since the start in 2016, reaching their highest level since mid-November. Late last year, the price dropped to nearly a decade low of $ 37 per tonne, but is now firmly back in the upward trend.

The latest rise in price came after the announcement of data on China's iron ore imports, which continued to impress in January at 82.2 million tonnes. Imports currently account for nearly four-fifths of the iron ore supply of the Chinese Metallurgy. Iron ore imports for the whole of 2015 also set a new record of 952.7 million tonnes, up 2.2 percent from 2014.

Domestic Chinese iron ore producers, who are struggling with low prices and high costs, are gradually being squeezed out of the market and replaced by import suppliers. Many Chinese mines remain on the market only because of the support of local governments, which are forced to keep jobs. The country's miners produced about 400 million tonnes of 62% Fe iron ore in 2014. According to some estimates, the volume of domestic production is currently down to 200 million tons with a further drop likely.

Analysts are skeptical about the longevity of iron ore growth and point out that Chinese steel production, which accounts for nearly half of global output, is set to decline further in 2016 after stopping three decades of continuous growth last year.

The supporting factor in the rise in prices was also the temporary closure of the ports of Australia - Port Hedland and Dampier, due to unfavorable weather conditions. Although, Port Pilbara represents nearly 30 percent of world trade.