The price of iron ore has slumped in offshore trade, moving to a more than two-month low as traders eyed record exports from Australia’s largest ore terminal.
At the end of the latest session, benchmark iron ore for immediate delivery to the port of Tianjin in China was trading at $US55.80 a tonne, down 5.3 per cent from its prior close of $US58.90 a tonne.
It is now trading at its lowest mark since April 23.
The commodity is enduring one of its worst runs through a bear market that has seen it lose 60 per cent of its value in the past 18 months. Over the past 15 sessions iron ore has risen just once, with the overnight fall its worst through the recent downward slide.
Driving the losses was news of record exports from Port Hedland in June, which is used by both Fortescue Metals and BHP Billiton.
Total shipments at the world’s largest bulk-export terminal surged 14 per cent year-on-year to 38.3 million tonnes last month. On a monthly basis, shipments rose 3 per cent, furthering concerns about a global glut.
With the sudden spiral lower in the commodity’s price, several miners are again approaching their break-even marks, placing pressure on stocks.
The spotlight will again turn to local heavyweight Fortescue, which has already seen its share price slip 23 per cent over the last three weeks despite a 4 per cent rebound yesterday. The Andrew Forrest-chaired group has managed to get its break-even price down into the mid $US40s, but its stock appears positioned to soon test its $1.75 post-crisis low.
Fortescue finished yesterday at $1.91 a share.
London-listed stock of Rio Tinto and BHP Billiton rose by 0.5 per cent and 1 per cent overnight, respectively, despite the latest price plunge.
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