The Canadian Press reported that volatile iron ore prices in 2013 should prompt Chinese firms to continue investing in Canadian development projects.

Ms Jackie Przybylowski of Desjardins Capital Markets expects investments will continue on an opportunistic basis" in the coming year, after a very active 2012 when the Chinese bought into projects around the world, including five in Canada.

Mr Przybylowski said that "Chinese steelmakers' investment in Canadian iron ore and metallurgical coal development projects is a positive as this provides firms with access to much needed and hard to secure capital."

Late last year, China Steel Corporation in partnership with South Korean steelmaker POSCO, acquired a 15% stake in Montreal based ArcelorMittal Mines Canada for USD 1.1 billion in cash.

Earlier Chinese investments in Canada included Century Iron Mines Sunny Lake project, Northern Star Minerals Ltd, Alderon Iron Ore and Adriana Resources' Lac Oteinuk project.

Ms Przybylowski said that investors are seeking projects with potential for significant longer term production volumes and will generally invest in projects at an early stage.

She said that Champion Iron Mines is viewed as the most likely to sign a JV partnership or supply agreement since it faces a large gap between anticipated 2013 spending an available funds. The Toronto based company didn't respond to a request for comment.

Others companies developing projects in Canada, such as Alderon Iron Ore and New Millennium, have deals in place that are expected to provide some or all of the required capital spending this year, deferring their need to raise cash.

She added that Chinese steel firms will continue to secure long term ore supply and manage input costs in the face of continued volatility of iron ore prices this year.