NOMURA International, Japan‘s investment bank, has raised the stakes in iron ore price talks by predicting a year-on-year rise of 70%.

The prediction, in a note to clients, would take the contract price closer to the high present spot price of about $133 per tonne CIF China – about 95% above the 2009 contract level.

In support of its prediction, Nomura suggested that China's inability to increase domestic output would push spot prices even higher.

For the next month, the 2010 iron ore price talks will be played out in Singapore among mining giant Rio Tinto, BHP Billiton and Vale, plus Baosteel representing China.

Also, delegations from Japanese and South Korean steelmakers are in town, which have already conferred with the mining companies. It has been widely reported that the miners have proposed a 40% increase in contract prices.

The head of the China Iron & Steel Association, Wu Xichun, accused the mining companies last month of treating China unfairly on pricing.