The Fortescue Metals Group Limited (ASX: FMG) share price closed in the red on Thursday.
Fortescue shares fell 3.33% to $20.33 each. For perspective, the S&P/ASX 200 Index (ASX: XJO) dropped 0.67% today.
So why did the Fortescue share price fall?
Why did Fortescue drop?
Fortescue shares appeared to drop on the back of a lower iron ore price and global market falls.
However, Fortescue was not the only mining giant to descend today. Rio Tinto Ltd (ASX: RIO) slid 1.1%, while BHP Group Ltd (ASX: BHP) shares declined 0.75%.
Iron ore prices fell in global markets overnight amid concerns China will cut steel production by about 2.55%.
Commenting on the iron ore price to Reuters, Beijing-based steel analyst at CRU Group Kevin Bai said:
The news (of crude steel output cuts) may provoke worry in the raw materials market in the short run.
However, April contract iron ore on the Singapore Exchange pushed higher today, up 0.61% at last look to US$121 a tonne.
Commenting on the iron ore price in a report this morning, ANZ economist Madeline Dunk said "ten Chinese steel mills lowered their price of steel products". She added:
The impact of China's reopening may be short lived amid ongoing underlying issues in China's property market.
This could lead to further weakness in the iron ore price this year.
Goldman Sachs is tipping Fortescue to deliver a fully franked dividend of US$1.18 per share in the 2023 financial year, my Foolish colleague James reported today. However, this could be more than half in FY24 to US 62 cents per share, Goldman predicted.
Fortescue share price snapshot
The Fortescue share price has gained 7% in the last year, while it has slumped 11.18% in the last month.
Fortescue has a market capitalisation of about $62.6 billion.
