Site menu

Search by ticker code:
Generic filters

Menu

Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Fortescue (ASX:FMG) Shares Continue to Surge on Iron Ore Prices

Fortescue Metals Group Limited (ASX:FMG) shares have continued their climb today, up another 2% an hour after market open.

Fortescue Metals Group Limited (ASX: FMG) shares have continued their climb today, up another 2%.

Headquartered in Perth, Fortescue is the fourth largest iron-ore producer in the world, up there with the likes of BHP Billiton Ltd (ASX: BHP) and Rio Tinto Ltd (ASX: RIO). They are now the lowest cost provider of iron ore to China and they continue to expand their operations into Japan, South Korea and India.

Performance

Fortescue shares are now up 125% over the last six months and more than 5% just this week. The share price is now a full dollar higher than previous all-time-highs and it doesn’t look like it’s stopping.

The reason for the price rise is, of course, iron ore prices, which reached multi-year highs yesterday. According to Business Insider, mid and lower grade ores closed at five-year highs while high-grade ores closed at two-year highs.

Why Iron Prices Are Rising

A major factor behind the increase in iron ore prices has been constricted supply from Brazil and Australia, two of the world’s largest iron ore exporters. A large dam collapse in Brazil in January had a significant impact on iron ore prices throughout January and February.

The gains in iron ore prices have also coincided with an increase in the price of Chinese steel futures.

The steel futures increased due to a seasonal upturn in demand and a pickup in Chinese construction activity. This helped to support iron prices as they reached multi-year highs.

Will The FMG Share Price Keep Rising?

Iron ore prices won’t keep rising forever. While there is a shortage in supply at the moment, a reduction in Chinese demand or an increase in Brazilian production following recovery from the dam collapse could see prices begin to ease off.

With both Fortescue and Rio Tinto Ltd (ASX: RIO) sitting at all-time-high share prices, it seems like a risky time to invest. This Rask Media article examines Rio Tinto shares and whether it can be justified by the dividends it pays.

Personally, I would avoid price-taking companies like Rio Tinto and Fortescue when they’re at all-time highs. I would rather invest in one of the companies mentioned in the free report below.

[ls_content_block id=”14945″ para=”paragraphs”]

Disclaimer: At the time of writing, Max does not own shares in any of the companies mentioned.

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report for FREE by CLICKING HERE NOW and creating a 100% FREE Rask Account.

(Psst. By creating a free Rask account, you’ll also get access to 15+ online courses, 1,000+ podcasts, invites to events, a weekly value investing newsletter and more!)

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

Skip to content