August hasn't been a great month for the Mineral Resources (ASX:MIN) share price

From record highs to 2-month lows. What happened to the Mineral Resources share price?

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Deteriorating iron ore prices and sharp a selloff in the lithium sector has sent the Mineral Resources Limited (ASX: MIN) share price down 19% in August.

July bulls turned to August bears

Mineral Resources is a diversified mining business, offering the likes of mining services for some of the world's largest mining companies, in addition to its own commodity portfolio which includes iron ore and lithium.

July was a glorious month for the Mineral Resources share price, rallying to an all-time high of $65.38 and closing the month with a year-to-date return of 68.14%.

The bullish performance of Mineral Resources last month was supported by firm iron ore prices, trading well above US$220/tonne and the surging lithium sector.

ASX lithium shares such as Pilbara Minerals Ltd (ASX: PLS) and Orocobre Limited (ASX: ORE) would mark fresh all-time highs almost on a weekly basis in July and early August, surging to year-to-date returns of well over 100%.

Unfortunately, the opposite is now unravelling.

According to Fastmarkets MB, iron ore prices tumbled US$20.73/tonne on Thursday to an 8-month low of $132.66/tonne.

This means iron ore prices have tumbled more than 40% from May highs of ~US$230/tonne.

Furthermore, ASX lithium shares have taken a sharp turn for worse in the past week, with leading names like Pilbara Minerals and Orocobre down 7% and 6.65% respectively on Friday.

An article from The Motley Fool US flagged that Bank of America slapped an underperform rating on two of the biggest lithium mining companies, Albemarle and Livent.

This could have an impact on the Mineral Resources share price, given the company operates a 40:60 lithium joint venture with Albemarle.

Bank of America said that "both stocks are benefiting from "significant hype" regarding long-term demand for lithium metal, but according to the analyst, they may not be able to deliver on that hype."

Mineral Resources share price snapshot

The year-to-date performance of Mineral Resources has halved from 68% at the end of July to 31% by Friday, 20 August.

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