Fortescue Metals Group expects iron ore prices will remain around $US140 ($A131.48) per tonne in the short-to-medium term as Chinese demand remains strong but little new supply comes onto the market.

Fortescue reported yesterday it had achieved an average realised sales price of $US139 per tonne during the six months to December 31, down from $US149/t in financial 2010-11.

Spot iron ore prices slumped in October.

“Our core market in China remains strong and the iron ore index price has remained around $US140 per tonne, ” chief executive Nev Power said.

“Long term, China’s growth is forecast to be stable around the nine per cent mark and we don’t see significant new supply to come into the market in the short term, and, therefore, expect the price to remain in that range.”