* China June manufacturing activity fastest in three months
* Spot iron ore had best June performance since 2009
By Manolo Serapio Jr
MANILA, July 3 (Reuters) - Chinese steel futures climbed to their highest level since March on Monday, supported by firm demand in the world's top producer and data showing a recovery in China's manufacturing activity.
China's manufacturing sector cranked back into growth mode in June, expanding at the fastest pace in three months after unexpectedly contracting in May, as new orders and production rose, a private survey showed. comment from our steel mill clients is they have quite a lot of demand and got a lot of orders in hand," said an iron ore trader in Shanghai. "They're quite comfortable selling their cargo at a good price."
The most-active rebar on the Shanghai Futures Exchange SRBcv1 rose as far as 3,396 yuan ($500) a tonne, the highest since March 16. The construction steel product was up 1.8 percent at 3,366 yuan by 0213 GMT.
Powered by China's infrastructure push, Chinese construction steel producers are seeing their best profits in years, prompting them to boost output as prices rise. This year, rebar futures have gained almost 27 percent. steel margins have spurred mills' appetite for raw material iron ore, with spot iron ore prices rising 13.9 percent in June, the biggest increase for that month since 2009.
"We continue to see the iron ore rally gaining momentum in the short run as Chinese steel mill margins continue to remain elevated," Commonwealth Bank of Australia said in a note.
The most-traded iron ore on the Dalian Commodity Exchange DCIOcv1 was last up 0.9 percent at 475 yuan a tonne. It touched 480 yuan earlier, near a five-week peak of 484.50 yuan reached on Thursday.
Stocks of imported iron ore at China's ports reached 140.3 million tonnes last week, down 1.15 million tonnes from the previous week's 141.45 million tonnes which was the highest since 2004, according to data tracked by SteelHome. SH-TOT-IRONINV
Iron ore for delivery to China's Qingdao port .IO62-CNO=MB rose 0.4 percent to $64.95 per tonne on Friday, its strongest level since May 4, according to Metal Bulletin. ($1 = 6.7853 Chinese yuan)