China's iron ore import market became more active on Friday, with steel mills and traders both keen to make bookings after offers stood firm above $170 per tonne.
Spot offers of Indian ore fines with 63.5 percent iron content remained firm on Friday for a third consecutive day at $172-175 per tonne, cost&freight delivered to China, traders said.
The steadily firm iron ore offers have started to loosen the buying resistance of traders and steel mills, who were cautious after a big price rise was seen.
'The first quarter of 2011 is approaching and transactions for forward and spot materials have inched up as first-quarter index-based prices will definitely rise,' said an iron ore trader in Beijing.
Two major iron ore indexes inched higher on Thursday, reflecting rising prices for iron ore selling to China.
The Steel Index 62 percent iron ore benchmark was up 40 cents at $165.4 per tonne on Thursday and Metal Bulletin's iron ore index benchmark rose 72 cents to $164.42 per tonne.
China's iron ore imports surged 25.5 percent to 57.38 million tonnes in November from October, hitting an 8-month high, China's customs announced on Friday.
Domestic steel mills and traders were rushing orders in October after holding back in September when prices were volatile, and the surge was reflected in the increase in November deliveries.
For a table of China's monthly iron ore imports, please click:.
Chinese steel prices were unmoved on Friday, with the most active rebar futures at the Shanghai Futures Exchange closing at 4,715 yuan ($709.2) per tonne in morning trade, unchanged from the previous day. They hit a one-month high of 4,771 yuan per tonne on Tuesday.
Despite the expectations of higher prices in the new year, analysts suggested the market might see a correction in January. 'There seems to be a lot of capacity becoming available, with uncertain demand growth,' said Cameron Hunt, Metal Bulletin's iron ore index director.
China's supply difficulties have largely been caused by improving demand in Europe and other markets, as well as a decline in Indian deliveries. Both these problems could be resolved quickly and bring prices down from what are historically high levels, Hunt added.