Inflation worries

It could also be an early warning sign of inflation after the prolonged global recession — a possible new challenge for the Obama administration and Congress.

“It augurs poorly for inflation control,” said Gary Hufbauer of the Peterson Institute of International Economics.

The deal may help U.S. steelmakers rather than hurt them, because the U.S. is a net-exporter of iron ore, a component in steel, according to a report in the Financial Times.

Consumers in the U.S. might not see much of a difference, either. Worker healthcare costs are more of a cost driver for cars and trucks than steel prices, Hufbauer said.

But other commodity producers, jealously eyeing the price increase won by iron ore producers, are likely to look for their own opportunities.

“There’s the potential for a pretty significant run-up in commodity prices before the economy really gets strong, and that cannot be helpful for the overall economy,” Hufbauer said.

Oil prices have broken the $85 barrier, though they still aren’t expected to approach the highs of two years ago.

Copper prices are also bumping up. Bloomberg reported Tuesday that they hit a new high since the collapse of Lehman Brothers in 2008.