Steel mills in China continued to
stay out of the Iron ore market on weak demand, but some traders expect spot
iron ore prices to stabilize in the coming weeks.
Steelmakers are trying to keep
inventories of the steelmaking raw material at their lowest levels amid the
gloomy outlook for steel demand in early 2012, traders said. The likelihood
that Beijing would maintain tightening measures to manage inflation also
weighed on sentiment.
“The overall market remains
very cautious, but I expect there should be a new wave of replenishing
inventories by mills before the Spring Festival (Lunar New Year),” said an
iron ore trader in the coastal province of Shandong.
The most traded May steel Rebar
contract on the Shanghai Futures Exchange fell to 4,157 yuan ($650) per tonne
on Monday i.e. down by 0.76 % from the previous close.
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