(Yicai Global) Feb. 11 -- China's iron ore futures contracts surged 8 percent -- the new maximum daily increase allowed on the Dalian Commodity Exchange -- after the week-long Spring Festival holiday ended yesterday.
 

The most active future contract at the exchange is reaching CNY652 (USD96.60) per ton, its highest price since March 2017. It has risen about 22 percent since Jan. 25, hitting multi-month peaks in consecutive days during the week in the lead-up to the holiday break.
 

Concerns over world supplies became more acute during the holidays as Rio de Janeiro-headquartered Vale, the world's biggest producer of iron ore and nickel, announced it is invoking force majeure clauses to excuse its performance on several iron ore and pellets sales contracts on Feb. 5, after already saying it will shut down 10 percent of its capacity, or about 40 million tons of iron ore per year, to make its mines safer earlier.
 

The market worries safety concerns may force the iron ore giant to temporarily shutter more capacity to meet regulatory requirements, with New York-headquartered Citigroup already having raised its projected iron ore price 40 percent to USD88 for this year.
 

Brazil's mining agency ordered Vale to halt operations at its Corrego do Feijao mine following a deadly tailing dam collapse there on Jan. 25. 
 

The accident that occurred near Brumadinho in the State of Minas Gerais about 437 kilometers north of Rio de Janeiro unleashed a torrent of mud that swept through Vale's mining facilities and a nearby community, killing at least 165 people, and leaving hundreds still missing.

Editor: Ben Armour