China worries hurt Aussie iron ore miners

PERTH: Worries about China continue to weigh on the nation’s biggest iron ore miners, despite the release of record shipping figures.

Shares in Rio Tinto, BHP Billiton and Fortescue Metals Group are under pressure for the fourth straight day as concerns about a slowdown in China overshadow positive data released by the Port Hedland Port Authority on Wednesday.

Total exports at Port Hedland, in WA, totalled a record 29.9 million tonnes in December, an increase of 12 per cent on the same month in 2012.

The strong result came despite the closure of Australia’s biggest iron ore port as Cyclone Christine swept across the Pilbara last month. Ongoing buoyancy in the iron ore price has also failed to boost the sharemarket performance of the big mining houses as the steel making ingredient trades above $US133 per tonne.

Since January 1, Fortescue Metals shares have lost nine per cent of their value, while Rio has shed 4.5 per cent and BHP is 3.5 per cent lower.

Mid-cap iron players Atlas Iron and BC Iron haven’t escaped unscathed, recording losses of 10 per cent and nine per cent, respectively, over the same period.

IG market analyst Evan Lucas said that despite the significant boost in shipments at Port Hedland, iron ore pricing in Australian dollar terms fell by more than three per cent in 2013. That compares to a 15 per cent fall in US dollar terms. "We’ve seen the iron ore miners across the board from the start of the week in a downward stretch," Mr Lucas said. "That’s really surprising."

He said recent production numbers and forecasts suggest the iron ore miners will record good first half earnings in February.

Mr Lucas believes the current lacklustre performance is due to negative market sentiment.
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