"On top of that, the seasonal restocking cycle of national steel inventories is drawing to a close, with the growth in stocks slowing this week, meaning that some mills will soon start to moderate capacity utilization rates," he said.
A report that China's central bank will keep liquidity reasonably ample to support economic recovery also provided a positive background in Thursday's trading.
Prices of key input iron ore remain elevated after last year's spikes driven by robust demand in China, which produced a record-high volume of steel despite the pandemic.
China reported its biggest daily jump in new COVID-19 cases in more than 10 months for Jan.13, underscoring the growing threat ahead of a major national holiday.
At the same time, portside iron ore inventory in China shrank to 126.75 million tonnes as of Dec. 31, down 4.1% from last year's peak of 132.15 million tonnes recorded on Nov. 13, SteelHome data showed.