Market participants were keen on what China's leadership change, which is happening later this week, has in store for the economy and its vast steel sector, with some hoping for pro-growth measures to be introduced to boost demand in the world's biggest steel consumer.
Iron ore with 62 percent iron content, the industry benchmark, gained 0.3 percent to $120.50 a tonne on
Monday, the highest since July 24, based on data from Steel Index.
The price first hit three-month peaks on Thursday, before slipping on Friday and regaining ground on Monday, reflecting a largely stable market backed by Chinese buying.
"We're seeing a balanced market. Buyers are in no rush to buy but they will take cargoes if the prices are not too high," said an iron ore trader in Shanghai.
"On the other side, it's difficult for miners to push up prices in a big way given how fragile demand is at the moment."
Price offers for imported cargoes in China were unchanged on Tuesday, although traders say some mills are snapping up fresh seaborne shipments versus cheaper port stocks.
"There could be a temporary shortage of certain iron ore grades at the ports, that why even if there's a $1-$2 gap between new cargoes and port stocks, the buying interest for seaborne is higher," said another Shanghai-based trader.
Inventories of iron ore at major Chinese ports fell last week for a fourth week running, standing at 93.3 million tonnes, data from Chinese consultancy Steelhome showed.
Top iron ore miner Vale has sold several cargoes on the spot market, totalling 1.8 million tonnes since late October, the second trader said.
Vale is selling two more on Tuesday - a 176,000-tonne cargo of 64-percent grade iron ore pellets and 146,000 tonnes of 62.8-percent iron ore fines, traders said.
Most of those shipments, including cargoes from BHP Billiton and Rio Tinto , were sold at prices either slightly firmer than previous tenders or little changed, traders said.
Iron ore shipments to China from Australia's Port Hedland rose 16.5 percent to 17.63 million tonnes in October from September, port authority data showed.
"We have sold almost one third of our stocks," said the first trader whose company has slightly more than 200,000 tonnes of iron ore cargoes at Chinese ports.
"We are still staying away from new purchases. We want to see what happens to China after the leadership change."
Ahead of China's leadership transition, investors were also exercising caution before Tuesday's US presidential election, with most commodity prices, including Shanghai steel, trapped in narrow ranges.
Shanghai rebar futures closed nearly flat at 3,642 yuan ($580) a tonne.