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FXstreet.com (Barcelona) - Australian Iron ore prices have partially recovered following a string of heavy declines, which saw prices bottom out at close to USD $85 per ton (CFR Tianjin) in early September. Announcements of investment infrastructure projects in China combined with a run of soft Chinese economic data have heightened expectations that Chinese authorities will do even more to bolster growth in the world's largest steel producing and consuming nation, which should help to support prices at historically high levels.

According to the NAB Analyst Team, "In USD terms, the NAB non-rural commodity price index is forecasted to fall by around 19% over 2012, before seeing a slight, and temporary, boost of around 2% in 2013. Given our forecast for the AUD/USD over the remainder of the forecast horizon, AUD prices are expected to fall by 18% through the year to December 2012, before rising 5.25% over 2013."

The Australian farm sector remains on the right side of the multi-speed economy - "grains prices are up significantly due to the northern hemisphere droughts and this will likely flow through to the livestock sectors. In all, we estimate that this has likely added around USD $6 billion in export incomes to the Australian farm sector. That being said, some sectors such as diary and food processing are continuing to suffer from the high AUD." the Team adds.

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