Fortescue Metals Group – world’s 4th largest iron ore producer, recorded mined ore production at 51.9 MnT in Q1 FY19, up 14% as against 45.7 MnT in Q1 FY18. The production for the quarter ending Sep’18 hit highest since Q1 FY18. On quarterly basis, the production volume increased 4% in Q1 FY19 as against 49.8 MnT in Q4 FY18.
Iron Ore Shipments in Q1FY’19 dip 14% on quarterly basis
FMG depicted fall in quarterly shipments in Q1 FY19 at 40.2 MnT, down 14% as against last quarter at 46.5 MnT. On yearly basis, the shipments stood 9% down as against 44 MnT in Q1 FY18.
The average price realisation during the September quarter increased by 12.5% to USD 45/DMT compared to the prior quarter.
Shipments to Non-Chinese markets dropped 5% Q-o-Q
The Company accounted for 10% of total Q1FY’19 shipments to non Chinese markets at around 4.0 MnT. The shipments have dropped marginally against last quarter at 4.2 MnT.
However, the steel industry in China remains healthy, with strong production, high steel margins and low finished steel inventories across the industry. This continues to support strong demand for imported iron ore.
Recent Updates
* FY’19 guidance: FMG FY’19 shipment guidance unchanged at 165-173 MnT.
*Fe 60.1% grade ore commencement: The company is to commence production of Fe 60.1% grade product in December and will deliver about 5-10 MnT during H2 FY19.
*Eliwana mine and rail project: The project received approval in last quarter; the first ore is expected to be delivered in Dec 2020. The project is expected to support West Pilbara Fines production of 40 MnT p.a.
*Autonomous Haulage (AHS): FMG focuses on driverless trucks to cut costs. The company is heading towards conversion of over 100 trucks to AHS at Chichester Hub, with 32 trucks already put to operation.
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