Iron ore prices steadied near 6 and half month highs on November 29th 2010 supported by fewer Indian supplies and demand from Chinese steel mills.
A trader in Rizhao in China's eastern Shandong province said that "Iron ore prices are still witnessing a mild increase. Chinese mills are still building stocks ahead of the New Year and steel prices have been inching up."
ANZ in its November report said that "Iron ore is regaining its premium commodity status, rebounding strongly over the past couple of months as confidence returns to the Chinese steel market.”
ANZ also said the recent mild build in iron ore stocks at Chinese ports suggests traders are returning to the seaborne market "to satisfy higher and more normal domestic steel capacity levels."
ANZ said that tight iron ore supplies should continue to aid prices with the cold snap in China likely to slow domestic iron ore production, adding to concerns over limited Indian cargoes.
Traders said that an ongoing ban on iron ore exports from the southern Karnataka state in India also kept supplies of high grade material limited. Karnataka accounts for a quarter of shipments from India.