The BHP Group Ltd (ASX: BHP) share price has rallied 8.5% in the last month to a close of $51.27 on Friday.
Shareholders in the iron ore major have their eyes set on the previous record high of $51.91, recorded on Friday 16 July.
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Why the BHP share price continues to test record highs
The bullish performance of BHP shares has been supported by record-setting movements from the broader equity markets.
Last Friday, the S&P/ASX 200 Index (ASX: XJO) and major US indices, the Dow Jones Industrial Average, S&P 500 and Nasdaq all closed at record highs.
In addition, iron ore spot prices have remained elevated, trading at US$216.03, according to Market Index.
Meanwhile, the Australian Bureau of Statistics has also released preliminary estimates of international merchandise trade, reporting a record $20.49 billion from metalliferous ores.
More specifically, the ABS states: "This is the fourth consecutive record month for metalliferous ores. Driving the increase was iron ore, up $1,043m (6%) to $17,553m. The iron ore increase was primarily price-driven despite recent pressure to reduce prices."
Iron ore spot prices higher, but Chinese futures lower
While current iron ore spot prices bode well for the BHP share price, futures contracts aren't looking too rosy.
Iron ore futures contracts on China's Dalian Commodity Exchange experienced their steepest weekly fall in 17 months last week.
According to Mining.com, "The most active September contract on China's Dalian Commodity Exchange has fallen roughly 10% from last week, its biggest weekly drop since February 2020."
"Iron ore's most-traded August contract on the Singapore Exchange dipped 0.2% to $197.25 a tonne."
Mining.com reported that China is looking to drive its steel output lower, with authorities asking "steel mills to ensure their output this year will be no more than 2020 volumes, after first-half production rose roughly 12% from the same period last year".
Foolish Takeaway
While iron ore spot prices have remained higher, China continues to tamper with domestic consumption and supply.
Between May and June this year, China announced plans to increase domestic iron ore production, improve domestic management of commodities and release state reserves to stabilise prices.
During this time, the BHP share price tumbled from highs of $51.74 on 11 May to lows of $45.82 by 21 June.
