Fortescue smashes iron ore export record
Fortescue Metals shipped a record volume of iron ore in the six months to December, as its traditional business further provides a strong platform for the company’s high-stakes pivot into clean energy.
The 96.9 million tonnes of iron ore shipped in July-December was 4 per cent higher than the year-earlier period, and 17 per cent higher than the equivalent period just four years earlier in 2018.
It puts Fortescue on track to meet the top end of its full-year export target, even though the Iron Bridge magnetite project appears likely to make a weaker-than-expected contribution to that goal.
Iron Bridge has suffered significant cost and schedule blowouts and the most recent update suggested it would supply 1 million tonnes of magnetite concentrate between March and June 30.
That target was considered very conservative for a project capable of producing 22 million tonnes a year, but ambitions were lowered even further on Friday to “less than” 1 million tonnes in the year to June.
Construction costs were said to be close to $US3.8 billion ($5.3 billion).
But even if Iron Bridge does suffer more delays and cost blowouts in coming months, Fortescue’s existing mines appear capable of getting the company to its goal of exporting between 187 million and 192 million tonnes this year.
The record haul of almost 97 million tonnes over the past six months marks the fifth consecutive year of first-half export growth.
Fortescue reported first half exports of 93.1 million tonnes in January 2022 and 90.7 million tonnes in January 2021.
First half exports totalled 88.6 million in January 2020 and 82.7 million in January 2019.
The miner exported 49.4 million tonnes in the past three months; better than the 48.7 million tonnes Macquarie had expected.
Fortescue received an average of $US87 a tonne for its ore; about 88 per cent of the average price for “benchmark” ore with 62 per cent iron.
That price realisation was an improvement on the 70 per cent realisations reported for the same period last year.
Fortescue’s iron ore division is providing the money for “Fortescue Future Industries” to pursue clean energy projects like the construction of factory at Gladstone that will build hydrogen electrolysers.
Fortescue’s partner in that factory, US company Plug Power, confirmed on Thursday that it had withdrawn from the project because it did not believe the project was economically attractive.