* Shanghai rebar futures steady above 4,800 yuan/tonne

* Low-grade Indian ore prices up on limited cargoes (Adds India truckers' strike called off, updates rebar price)

By Manolo Serapio Jr

SINGAPORE, Aug 24 (Reuters) - Spot iron ore prices held firm on Wednesday, as strong steel output in top producer China kept buying interest for the raw material intact, with tight Indian supplies lending support.

Brisk construction demand has pushed Chinese mills to produce more than 1.9 million tonnes of crude steel since late February, up from last year's daily average of around 1.7 million tonnes.

"The Chinese continue to produce steel like crazy and Indian supplies are extremely tight at the moment," said an iron ore trader in Singapore, citing factors supporting prices.

Offers for Indian grades rose by a dollar on Wednesday, with the widely traded 63.5/63 grade quoted at $187-$189 a tonne, cost and freight, said Chinese consultancy Umetal.

Monsoon rains and logistical problems have been disrupting shipments from India, the world's No. 3 iron ore supplier after Australia and Brazil.

"It's very, very difficult to get cargo from India. Goa is closed because of the monsoon season and there is also a truckers' strike in the eastern side and that is adding to logistics problems," said a Shanghai-based trader who sells Indian material to Chinese mills.

 

The strike was called on Aug. 18 to seek uniformity in Indian road toll and carriage charges as well as insurances issues.

But G.R. Shanmugappa, president of the All India Motor Transport Congress, said the strike has been called off after an assurance from the government that the truckers' demands will be met.

Shipments from India's southern Karnataka state have yet to resume even after the country's top court ordered a ban, in place since July 2010, lifted in April.

LOW-GRADE ORE SHINES

There is also increased interest in low-grade Indian ore given limited supplies.

"I've sold a 55/54 cargo at $134 (a tonne, cost and freight), which I think is a record price," said the Shanghai-based trader.

"Typically this grade would be around $100 but now we're seeing absolutely crazy transactions happening in the market," he said.

Global miner BHP Billiton sold Newman and Yandi iron ore fines at $183 and $159 a tonne, respectively, at a tender on Tuesday, about a dollar higher than previous deals, said the Singapore trader. Newman fines are being offered on Wednesday at $185 per tonne, he said.

 

"Prices are not exploding, they're creeping up, but creeping up amid a very uncertain macro environment in the developed world.

"So if we do find stability in the macro environment, I'd see spot prices increasing significantly," he said.

Iron ore prices are mostly taking their cue from firmer steel prices in China.

The most-active January rebar contract on the Shanghai Futures Exchange closed nearly flat at 4,822 yuan a tonne, staying above 4,800 yuan for one and a half weeks now.

Iron ore with 62 percent iron content rose 10 cents to $177.90 a tonne on Tuesday, its highest since Aug. 8 and marking its sixth-straight session of gains, The Steel Index .IO62-CNI=SI shows.

Metal Bulletin's similar gauge .IO62-CNO=MB rose 44 cents to $177.77 a tonne and Platts index IODBZ00-PLT gained 25 cents to $179.75. (Additional reporting by Ratnajyoti Dutta in New Delhi; Editing by Ramthan Hussain)