Shares in the company have tumbled nearly 38 per cent since the start of the year, largely due to a slump in iron ore prices, leaving it among the worst performers in the S&P/ASX 200 index.

Iron ore prices fell below US$100 a tonne earlier this week, extending this year’s losses to about 30 percent. The decline is expected to continue amid ongoing concerns about demand versus abundant supply, especially given the ongoing slowdown in China’s construction industry.

Market analysts warn that things could get worse for China, and in turn for Fortescue, if Donald Trump is elected the next US president.

In addition to Fortescue, Australian companies BHP and Rio Tinto also suffered significant losses, with valuations falling by billions and share prices falling 18% and 16% respectively.

Jun Bei Liu, lead portfolio manager at Tribeca Investment Partners, noted that China's slowdown is currently having a bigger impact on companies like Fortescue than U.S. policy.

However, she predicted that Trump's increased "China bashing" would further strain an already struggling economy, which could negatively impact Australian resource companies with a strong China focus.

During his last presidential campaign, Trump announced plans to impose a 10 percent tariff on all imports and a 60 percent tariff on Chinese goods.

"At this point, investors are saying that obviously the trade conflict and the strikes on China will be the key policy, and especially the China part of it is almost bipartisan." This is something that will potentially escalate as the election heats up,” Liu said.

"It is clear that the tariff will put more pressure on the Chinese economy. China's economy has been struggling for a while now, it's really struggled to get back to pre-Covid levels of economic activity and with their housing slump, they really need things to go smoothly to recover.”

But Liu emphasized that Democrats are also touting more tariffs on Chinese companies, along with maintaining the tariffs Trump imposed in 2018.

"Iron ore prices that many analysts are projecting at around US$80 in the longer term ... but they are holding at US$100 for a while even though China's economy is quite bad," she said.

In its July publication, the Australian government Resources and Energy Quarterly the report projects iron ore prices to reach US$77 per tonne by 2026, while CBA expects a long-term price of US$68 per tonne.

In an investor note this week, Morningstar's John Mills also warned that Fortescue's challenges could worsen under the Trump administration.

“As steel exports from China will face headwinds and the company's mines are relatively high on the cost curve, Fortescue's competitive position is relatively weak. Additionally, Trump's plan to repeal the Inflation Reduction Act – which provides significant subsidies for green hydrogen – could also impact Fortescue's US-based investments in green energy,” Mills said.

Despite his concerns, Liu remains optimistic about 2025, suggesting that China's electrification drive could boost demand for iron ore, potentially making up for the gap left by construction delays.

"The amount of iron ore and copper and things like that needed for electrification is going to be significantly more significant in the medium term ... so I think we're right in that in-between period where the traditional costs of rail and housing are still not developing, but renewable energy sources are yet to develop to the extent of this weakness, but I think going into next year the momentum is pretty strong."

Maja Garatsa Djurdjevic

Maya's career in journalism spans more than a decade in finance, business and politics. Now an experienced editor and reporter in all elements of the financial services sector, before joining Momentum Media, Maya reported for several established news outlets in South East Europe, looking at key processes in post-conflict societies.