Iron Ore Mining
A miner holds a lump of iron ore at a mine located in the Pilbara region of Western Australia in this December 2, 2013 file photo. World no. 2 iron ore miner Rio Tinto said on July 16, 2014 expansion work at its mines and productivity gains led to a sharp rise in iron ore output as it steps up shipments to Chinese steel mills. Picture taken December 2, 2013. REUTERS/David Gray/Files

After hitting record-low iron ore prices in the international market, there are indicators that the market has bottomed out. On late Monday, price of the key steelmaking ingredient went up 4 per cent, logging its largest one-day gain in seven months.

According to the Steel Index, the spot price of iron ore increased to $83.10 per metric tonne, reports The Wall Street Journal. In late September, prices of iron ore tumbled down to its lowest level in 2009 after suffering from a 42 per cent decline since January.

The journal noted that while the price of other commodities, including copper, surged on Monday due to stronger Chinese import, it was the strong upward movement in the price of iron ore that was more noticeable.

Charlie Aitken, executive director of Bell Potter Securities, observed the rising confidence in the commodity, while traders were purchasing in anticipation of supply no longer "dramatically outstripping demand."

Commonwealth Bank analyst Lachlan Shaw added that recent pronouncement by top officials in China that the Asian giant would meet its 2014 growth target of 7.5 per cent boosted confidence in iron ore.

Marubeni, the Japanese iron ore partner of Australia's mining magnate Gina Rinehart, shared the growing sentiment that the country's iron ore market had bottomed out and is expected to further rise in 2015.

Following the improved iron ore prices, shareprices of key Australian iron ore producers went up by 4 per cent to $60.72 for Rio Tinto (ASX: RIO), 2.7 per cent to $33.47 for BHP Billiton (ASX: BHP) and 5.8 per cent to $3.66 for Fortescue Metals Group (ASX: FMG).

The improved outlook also affected positively junior iron ore miners as the shareprices of Mt Gibson jumped by 16.9 per cent to 52 cents, Atlas Iron by 14.9 per cent to 42.5 cents and BC Iron by 13.1 per cent to $1.60.

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