Thursday, 24 January 2013 14:05
Fortescue Metals Group has maintained its full year targets for iron ore production after lifting its shipments in the second quarter of the financial year.
Fortescue shipped 19.6 million tonnes of iron ore in the three months to 31 December, up 22 per cent from the preceding three months and up 32 per cent on the same period in the previous year.
Higher shipments were a result of increased production from its processing facility at Christmas Creek and early mining activity at the Firetail deposit in its Solomon project, the company said on Thursday.
The Firetail mine is on schedule to deliver 20 million tonnes of ore per annum from March, increasing Fortescue's capacity to 115 million tonnes per annum, it said.
Production guidance for the 2012/13 financial year remains between 82 and 84 wet metric tonnes (wmt), Fortescue said.
Costs rose in the three months to December, as production increased and the high Australian dollar remained a factor, Fortescue said.
Cash costs per tonne of ore were $US50.48 in the second quarter of the financial year, up from $US49.44 in the first quarter.
Fortescue expects cash costs per tonne to range between $US45 and $US50 per tonne for the remainder of the 2012/13 year.
The realised cost and freight sales price in the three months to December was $US111 per dry metric tonne (dmt), down from $US113 dmt in the preceding three months.
"Fortescue expects market conditions in China will continue to stabilise in the near term," Fortescue said in a statement.
"Steel mills are readjusting their raw material stocks to maintain more sustainable stock levels.
"With China's new leadership starting to rejuvenate programs of economic growth and urbanisation, steel demand is expected to increase and support iron ore prices."
Fortescue Metals Group
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