* Iron ore jumped 4.5 pct to above $55/T on Monday
* Dalian futures drop, away from one-month top
By Manolo Serapio Jr
MANILA, Aug 4 (Reuters) - Spot iron ore prices climbed more than 4 percent to above $55 a tonne on expectations China's anti-smog efforts ahead of a big September event would push mills to produce more before the curbs are imposed.
Beijing will limit the number of vehicles on the streets and shut factories to ensure clean air during a commemoration of the 70th anniversary of the end of World War Two on Sept. 3. The controls will be imposed from Aug. 20. ID:nL3N10E2WZ
The measures are expected to extend to areas surrounding Beijing including the top steel producing province of Hebei and neigbouring city of Tianjin, industry sources say, following a similar effort last year.
In November, China asked steel mills and other heavy, pollutive industries straddling Beijing to cut or suspend production ahead of and during the Asia-Pacific Economic Cooperation summit in the capital.
Ahead of the stoppage, spot iron ore jumped 4.5 percent to $55.30 a tonne .IO62-CNI=SI on Monday, matching last week's peak, a four-week high, according to data compiled by The Steel Index.
"Some construction projects would like to speed up work and also mills would like to increase production before the stoppage takes effect in order to compensate for losses they would incur during that period," said a Shanghai-based trader.
"As much as 6 million tonnes of steel production may be forced to be shut, leading to a 10-million tonne reduction in iron ore demand," ANZ Bank analysts wrote on the latest anti-smog efforts.
But traders said the bounce in iron ore prices may be temporary with Chinese steel demand slowing along with the economy.
Shanghai steel futures SRBcv1 hit a four-week high on Monday, although they have since traded lower, closing 0.1 percent weaker at 2,097 yuan ($340) a tonne on Tuesday.
"Once steel mills have resumed output, the market will enter negative territory again," said Xia Junyan, an analyst with Everbright Futures in Shanghai.
The January iron ore contract on the Dalian Commodity Exchange DCIOcv1 dropped 0.7 percent to end at 366.50 yuan a tonne.
Rebar and iron ore prices at 0711 GMT
Contract
Last
Change Pct Change SHFE REBAR JAN6
2097
-2.00
-0.10 DALIAN IRON ORE DCE DCIO JAN6
366.5
-2.50
-0.68 SGX IRON ORE FUTURES SEP
50.95
-0.05
-0.10 THE STEEL INDEX 62 PCT INDEX
55.3
+2.40
+4.54 METAL BULLETIN INDEX
55.63
+2.22
+4.16
Dalian iron ore and Shanghai rebar in yuan/tonne Index in dollars/tonne, show close for the previous trading day ($1 = 6.2095 Chinese yuan)