The BHP Group Ltd (ASX: BHP) share price is sliding today.
Shares in the S&P/ASX 200 Index (ASX: XJO) mining giant closed Friday trading for $44.39. In late morning trade on Monday, shares are changing hands for $43.82 apiece, down 1.3%.
That sees the big Aussie miner trailing the benchmark, with the ASX 200 down a lesser 0.4% at this same time.
It's not just the BHP share price that's underperforming though. Fortescue Metals Group Ltd (ASX: FMG) shares are down 1.9%, while Rio Tinto Ltd (ASX: RIO) shares are down 1.5% at this same time.
Here's why the ASX 200 miners are battling headwinds today.
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Why is the BHP share price underperforming on Monday?
Most of the selling pressure impacting BHP, Rio Tinto, and Fortescue today appears to be due to the 3% decline in the iron ore price over the weekend. After defying bearish expectations and climbing for most of the first week of July, the iron ore price dipped back to just over US$110 per tonne.
The reason once more looks to be driven by concerns that China's sluggish, steel-hungry property markets have yet to regain any solid growth traction. Coupled with news of growing iron ore stockpiles at China's largest ports, iron ore traders have been favouring their sell buttons.
With iron ore counting as BHP's biggest revenue earner, the BHP share price is joining in that sell-down today.
Indeed, over the half-year to 31 December, the miner reported earnings before interest, taxes, depreciation and amortisation (EBITDA) of US$9.7 billion from its iron ore division alone.
In its half-year report, released on 20 February, BHP estimated it will produce between 254 million and 264.5 million tonnes of iron ore in FY 2024.
So any pull back in demand from China, the world's biggest consumer of iron ore, is going to have an impact on the BHP share price.
The miner addressed its own cautious outlook for Chinese iron ore and other commodity demand earlier this year, stating:
The Chinese economy has been volatile since the zero-COVID policy was eased in December 2022…
Throughout the year authorities have acknowledged that additional policies will be needed to support China's economic recovery. For the balance of FY24 and into FY25, the key question remains how effective the policy push will be. Until we see greater coherence between the policies and their effective implementation, our outlook will remain cautious and conditional.
With today's intraday moves factored in, the BHP share price is down 13% in 2024 but remains up 3% over 12 months.
