Following the news, the company's stock rose 0.81 percent to 8.70 yuan ($1.27) per share on the Shanghai Stock Exchange, outperforming the exchange's overall rise of 0.48 percent.

It was unclear what sort of "overseas resource base construction" Wuhan Iron & Steel's statement was referring to; further details were also unavailable on its regional development in China. Calls to the company were either unanswered or resulted in an immediate hang-up.

Wang Guoqing, a steel analyst with the Beijing Lange Steel Information Research Center, said that the company is in great need of money to invest in its existing overseas projects and new projects, especially at a time when the steel mill is performing sluggishly.

Wuhan Iron & Steel stepped up its search for iron ore globally this year.

The company announced in February it would set up a joint venture to explore iron ore and other resources in Madagascar; in May it signed a cooperation agreement with Australian miner WPG to become the latter's second-largest stakeholder; in July it became the largest shareholder of Canada's Consolidated Thompson Iron Mines, which has access to 2.3 billion tons in mineral resources.

The company was involved in three overseas deals last month: It was approved by the Australian government to jointly develop five mines in South Australia with more than 2 billion tons in iron ore with Australian miner CXM; signed a long-term iron ore supply contract with Venezuela's Corporacion Venezolana de Guayana; and became the second-largest shareholder in Brazil's MMX Mineracao e Metalicos SA mining group and is expected to build a steel plant in Brazil.

However, Wuhan Iron & Steel's financial performance has lagged its overseas expansion.

In late October, the company predicted a 50 percent year-on-year drop in its annual profits following a third quarter net profit of 546.6 million yuan ($80.04 million), down 76 percent from its profit of 2.26 billion yuan ($330.93 million) a year ago. The company attributed the drop to weak market demand and low sales prices.

Ma Zhongpu, chief analyst with the steel research company Umetal, said that China is diversifying its iron ore supply sources globally to reduce dependence on the world's three largest iron ore miners, Vale SA, Rio Tinto Group and BHP Billiton, which control three-quarters of global seaborne supply.

"Though China is the world's largest iron ore consumer and bulk cargo shipping market, it has little say in the world iron ore market," Ma said.

Since China first took part in iron ore price negotiations in 2004, prices have risen on a large scale almost every year. High iron ore prices impose huge cost pressure on domestic steel mills, whose returns on sales were only 3.39 percent in the first half of the year, the lowest return since 2004.

Last year's iron ore talks failed as miners and the China Iron and Steel Association, which negotiates on behalf of all Chinese steel mills, could not agree on a price.

Ma said the supply and demand structure of the global iron ore market could see significant changes as China speeds up its search for a diversified supply.

China imported 440 million tons of iron ore last year, of which 60 percent was supplied by the top three miners.