Iron Ore-Key index at near 9-month top, rebar at record

Iron ore could hit $200/T, not seen since 2008

* Brazil rains may cut iron ore exports by 30 pct-TSI

* Indian 63.5 pct grade offered at as high as $190/T (Refiles to remove garble in paragraph 2)

By Manolo Serapio Jr. and Ruby Lian

SINGAPORE/SHANGHAI, Jan 17 (Reuters) - Shanghai rebar futures surged to a record high for a second straight day on Monday as tight supplies and firm Chinese demand pushed up iron ore prices to their loftiest in nearly nine months.

Concerns heavy rains in Brazil may disrupt exports from the world's No. 2 iron ore supplier along with already tight supplies from third-ranked India at a time when Chinese steelmakers are building stocks ahead of the Lunar New Year next month could lift prices to $200 a tonne, a level not seen since 2008.

"We could see prices rise to $200 over the next month if the supply interruptions continue," said Troy Flannery, senior mining analyst at DJ Carmichael in Perth.

"I think you're going to see a bit more volatility in the spot market because of these supply disruptions as quite possibly some of the steel mills are trying to get ahead of the game by securing their raw material as soon as they can."

The rainy weather in Brazil could reduce its exports by as much as 30 percent in February, iron ore reference price provider the Steel Index (TSI) said in a report. "Add to this strong Chinese demand and the outlook for prices is extremely bullish," TSI said.

The Platts 62 percent iron ore index IODBZ00-PLT jumped more than 3 percent to $182.50 a tonne, cost and freight, on Friday, the highest since late April 2010.

Surging prices of iron ore as well as coking coal after massive floods tripped up production and shipments from top exporter Australia lifted Shanghai steel rebar futures to a record level.

The most active May rebar contract rose 0.6 percent to as high as 4,933 yuan per tonne, before trimming gains to 4,910 yuan by the midday break, up 0.1 percent.

TOO FAST TOO SOON?

Indian ore with 63.5 percent iron content was being quoted at $185-$187 a tonne, C&F, on Monday,with some offers going as $190, said Chinese consultancy Mysteel. That compared to offers of $183-$185 a tonne on Friday.

"It's unbelievable that spot offers have hit a high of $190," said a senior iron ore official at a major Chinese steel mill. "Luckily, we have already built up enough stocks for the Lunar New Year."

China's week-long New Year holiday starts on Feb. 2.

"Steel mills are finding it hard to accept the surging cost of iron ore and might suspend buying for a while," said a Beijing-based trader.

The sustainability of the rally in iron ore prices also hinges on whether steel producers can pass on higher cost as quickly as it comes, traders said.

Many steelmakers across Asia have raised product prices due to the rising cost of raw materials, but South Korea's POSCO , the world's No. 3 steel producer, last week warned it would be difficult for them to fully pass on the costs.

Highlighting iron ore prices could rise further, forward swaps <0#SGXIOS:> extended gains on Friday. The Singapore Exchange-cleared February contract rose $1.44 to $174.25 a tonne and March edged up 88 cents to $171.94. (Editing by Clarence Fernandez)