Why was the Fortescue share price on such a rollercoaster today?

We take a look at how the day played out for the iron ore player.

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Key points
  • Fortescue shares finished in the green today, after trading in the red for much of the afternoon
  • Overnight, the iron ore price fell to its lowest point since late 2021
  • Fellow iron producers Rio and Vale SA provided production updates 

The Fortescue Metals Group Limited (ASX: FMG) share price was up and down like a yo-yo on Tuesday.

Fortescue shares closed at $17.07 today, up 0.95% on yesterday's closing price. For perspective, the S&P/ASX 200 Index (ASX: XJO) lifted 1.72% today.

Let's take a look at what went on with the Fortescue share price today.

a mine worker holds his phone in one hand and a tablet in the other as he stands in front of heavy machinery at a mine site.

Image source: Getty Images

What went on?

Fortescue shares lifted 1.3% to $17.12 in early trade. However, the company's shares then slipped into the red during the afternoon before recovering to finish the day in the green.

BHP Group Ltd (ASX: BHP) shares rose 1.38% today while Rio Tinto Limited (ASX: RIO) shares also finished 0.14% in the green.

Fortescue is among the world's largest iron ore producers.

The iron ore price fell 1.55% overnight to US$95 a tonne, Trading Economics data shows. This is its lowest level since November 2021.

In March, the commodity was fetching almost US$160 a tonne and almost US$230 a tonne in May 2021.

Overnight, iron ore prices struggled amid news China is planning to maintain its COVID-19 zero strategy. It's expected to further constrict the nation's economic growth. China is the biggest iron ore importer in the world.

Also today, news emerged that iron ore giant Vale SA (NYSE: VALE) produced more iron ore than analysts expected in the last quarter. Vale produced 89.7 million metric tonnes of the commodity, ahead of expectations, Bloomberg reported. This may put more pressure on the iron ore price, the publication noted.

Meanwhile, fellow iron ore producer Rio Tinto released mixed third-quarter production results today.

Iron ore production jumped 1% to 83.4 Mt, while iron ore shipments fell 1% year on year to 82.9 Mt. Analysts had been tipping 84.5 Mt of iron ore shipments, my Foolish colleague James noted today.

Rio noted commodity prices "continued their downward trend" during the quarter, highlighting "there are further downside risks".

The Singapore Exchange Iron Ore Futures Contract for November is 0.17% in the red at the time of writing.

Share price snapshot

Fortescue shares have gained almost 16% in the past year, but they have fallen 11% year to date.

For perspective, the ASX 200 has shed 8% in the past year.

Fortescue has a market cap of $52.5 billion based on the current share price.

Motley Fool contributor Monica O'Shea has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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