Iron ore trading on low volumes in China, as buyers remain cautious over weak demand for steel. Iron ore prices rose half a percent and offers stayed firm on Friday due to tighter supplies for higher grade fines even as China's demand remained sparse.
Chinese steel mills, the biggest market for iron ore,slowed buying after a spurt that followed a week-long holiday earlier this month, which lifted prices to their highest since May.
China's crude steel output dropped 7.1 percent in September from August, government data showed on Thursday, and an industry official said the decline may extend into the fourth quarter as the world's largest producer makes a last-ditch effort to meet year-end power saving and emission reduction
Lower Chinese production pulled down global crude steel output to 111.75 million tonnes last month from 112.87 million tonnes in August.
"We don't see prices sliding further, the market should remain firm," said an iron ore trader in Singapore. "Supply remains tight for higher grade fines of 63.5 percent."
Still, "there's low buying interest for now. Customers are expecting $155-$157 for 63.5 percent Indian fines. We do not see suppliers willing to lower to around this range."
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