ASX:BHP

Why BHP’s Share Price Fell 1.77% Yesterday| ASX: BHP

BHP’s fall could be partly due to a statement made by a Chinese official Friday afternoon, confirming plans of cracking down on the excessive costs of the steel-making ingredient.Given the fact that China is the world’s biggest steel producer, it was inevitable that there would be ripple effects from the inquiry, hitting not only BHP but also Rio Tinto, whose share price fell 0.50%. Both Aussie companies produce a lot of iron for the world market and China is one country with high demand for it.

Iron Ore Prices Slump Back Down after Chinese Market Complaints

According to the Australian Financial Review (AFR), a top official on behalf of China’s steel industry said Beijing was getting ready to crackdown on soaring prices.Iron ore market has also been hit by supply disruptions, as weather plagues supply chains. Last month Rio Tinto cut production outlook after issues with its mine, adding further to supply shortages.

Iron Ore Prices Rise to Five-Year Highs

Building on its multi-month highs, iron ore prices have risen 8% this month, and over 50% this calendar year, to reflect a post-market buying frenzy over supply issues.Australia’s top export reached US$110.20 on SPGlobal’s iron ore index (IODEX), the highest in five years dating back April 2014.
Money Morning Australia