* Dalian benchmark iron ore contract rise for a third day
* Brazil bans upstream mining dams after Vale disaster
* China halts Australian coal orders amid customs delays
By Enrico Dela Cruz
MANILA, Feb 19 (Reuters) - Benchmark steel prices in China gained in early trade on Tuesday as steel-making raw material iron ore climbed for a third consecutive session amid concerns over supply disruptions.
Brazil’s government on Monday banned new upstream mining dams and ordered the decommissioning of all such dams by 2021, targeting the type of structure that burst last month in the town of Brumadinho, killing hundreds of people.
The move is seen as the strongest response yet from Brazil’s government to the disaster involving a tailings dam of top iron ore miner Vale SA. It would impact some 50 upstream mining dams in Brazil’s mining heartland of Minas Gerais state alone.
The most-active rebar contract on the Shanghai Futures Exchange was up 0.9 percent at 3,677 yuan ($543.16) a tonne, as of 0223 GMT. Hot rolled coil rose 1.7 percent to 3,657 yuan.
“Iron ore continues to influence the ferrous complex. Steel prices reflect the rising cost of iron ore and producers are passing it on to the consumers,” said Darren Toh, a data scientist with Singapore-based steel and iron ore data analytics company Tivlon Technologies.
The most traded iron ore contract on the Dalian Commodity Exchange edged up 0.6 percent to 634.5 yuan. Dalian iron ore dropped about 4 percent since hitting an all-time high of 657.5 yuan on Feb. 12, but is up about 28 percent this year.
Spot iron ore for delivery to China SH-CCN-IRNOR62 rose 1.1 percent to $88.80 a tonne on Monday, according to SteelHome consultancy.
Iron ore prices are expected to remain high for sometime with the market still focused on the impact of the loss of some supply from Brazil, ANZ analysts said in a note.
Coking coal dropped 0.9 percent to 1,258.5 yuan a tonne, extending its pullback after scaling a peak of 1,323.5 yuan last week.
Coke was down 0.2 percent at 2,063.5 yuan.
Chinese coal traders have stopped ordering Australian coal as clearing times through China’s customs have doubled to at least 40 days, according to major buyers in China and international coal merchants, resulting in a sharp fall in Australian prices.
Only cargoes from Australia, the biggest supplier of the fuel to the world’s top consumer, were affected, according to traders and a broker.
($1 = 6.7697 Chinese yuan)
Reporting by Enrico dela Cruz, Editing by Sherry Jacob-Phillips