Fortescue Metals Group is preparing to meet changing Chinese
demand for iron ore with its new West Pilbara Fines product.
In light of recent falling iron ore spot prices, there has been
an increasing trend among Chinese iron ore buyers for lower- and
The iron ore spot price for high grade 62 per cent fines has
plunged in the past two weeks from $US72.50 ($98.62) to $US63.74 in
part due to a growing Chinese preference for lower-grade ores for
Pre-slump, the Chinese iron ore export market tended towards
higher-grade iron ores produced by companies such as Rio Tinto and
BHP, while the lower grades favoured by Fortescue suffered.
Fortescue’s revenue fell 18 per cent in the 2018 financial
year to $US6.9 billion ($9.38 billion), while its profits fell 58
per cent in the same period to $878 million.
Speaking at the International Mining and Resources Conference
(IMARC) in Melbourne at the end of October,
Fortescue chief executive officer Elizabeth Gaines
suggested that the trade dispute between the United States and
China would not dampen short-term iron ore demand in the Asian
Despite this, Chinese manufacturing growth halted for the first
time in two years last month according to statistics from the
Purchasing Managers Index for China.
This has led to increased demand for lower cost, low- and
mid-grade iron ore fines, which puts Fortescue in a good position
to capitalise with its 60.1 per cent low alumina West Pilbara Fines
iron ore that it announced at a conference in Dalian, China in
Fortescue achieved a record low direct cost of $US12.36 per wet
metric tonne in 2018, a price it continues to maintain in the 2019
West Pilbara Fines are the result of a blend of fines from the
Chichester and Solomon projects in the Pilbara, Western Australia,
with fines from Fortescue’s
upcoming $1.7 billion Eliwana mine to be added to the mix down
Fortescue well-placed for Chinese demand with new iron ore
fines appeared first on Australian Mining.
Source: FS – Mining B.
Fortescue well-placed for Chinese demand with new iron ore fines