A slew of global investment banks recently forecast that iron ore prices would continue to rise in 2008, boosted by strong demand from China. However, steelmakers in China, the world's largest iron ore consumer, expect raw material prices to remain stable next year.

As negotiations with major global suppliers draw near, Shen Wenrong, chairman of Shagang Group, the country's fourth-biggest steelmaker, tells the Chinese news media there's no reason for a further hike in iron ore prices next year. Zhu Jimin, general manager of Shougang Corp., another large steel producer, agrees that iron ore prices next year should keep to the 2007 level—due to " basic balance" between supply and demand in the world.

The China Iron & Steel Association says that steel industry representative Baoshan Iron & Steel will start talks on iron ore prices for 2008 in November, with the world's top three suppliers of CVRD, BHP Billiton and Rio Tinto. In the meantime, some Chinese iron and steel enterprises are seeking to invest in overseas iron ore mines to assure future supplies.