(Bloomberg) — Cliffs Natural Resources Inc., the largest U.S. iron ore mining company, is quitting the seaborne trade in the commodity after the world’s biggest suppliers flooded the market with low-cost output and hurt prices.
The Cleveland-based company will focus on the U.S. market, where demand for steel is increasing, Chairman and Chief Executive Officer Lourenco Goncalves said at an industry conference in Perth, Australia, on Wednesday. The company’s operations in Western Australia are for sale, he said.
Iron ore tumbled 47 percent in 2014 and has extended losses this year as surging low-cost supply from Rio Tinto Group and BHP Billiton Ltd. outpaced demand growth, triggering a global glut. Goncalves, who took over as CEO in August after an activist investor ousted the previous management, has sold mines and rationalized other operations in the face of the slumping prices. Cliffs’ stock lost 71 percent over the past 12 months, and is at the lowest since 2004.
“Here in Australia, we have a very good operation,” said Goncalves. “The asset is for sale, even if someone comes and buys to shut it down, that’s fair game. We’d like to sell to someone that will continue to keep the mine in operation.”
Ore with 62 percent content at Qingdao fell 0.9 percent to $57.61 a dry metric ton on Wednesday, declining for a seventh day, according to data from Metal Bulletin Ltd. That’s the lowest since at least May 2009, when Metal Bulletin started compiling weekly prices.
Cliffs fell 3.5 percent to $5.27 at 10:28 a.m. in New York.
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