At Fortescue (FMG), yes the company missed those market estimates (because of the wet weather, a normal seasonal event in the Pilbara) but the tonnage shipped was still a record.
Fortescue said it shipped 30.8 million tonnes of iron ore in the quarter (with an average price of around $US107 a tonne based on the index price of $US120 a tonne for ore with a 62% content of iron oxide).
The market had 32 million tonnes down as its best guess. But the 30.8 million was up 15% from the december quarter and a massive 59% from the first quarter of 2013, which is the real story from the production report, not the miss on production.
Fortescue said production fell 8% from the December quarter’s figure, but was up 17% from the first quarter of 2013 (which again is the real story).
Fortescue said its cash costs of production or iron pellets rose 6% in the quarter from the December quarter, but they remain 30% below the level a year ago.
FMG 1Y – Shipments soar at Fortescue
The company maintained that it would continue to restrict spending to around $2.1 billion – two thirds lower than in the previous year with the expansion to an annual rate of 155 million tonnes complete.
The company reckons it will still make its export target for the full year of 127 million tonnes by June 30, but to do that it will have to boost sales by around a third to more than 41 million tonnes in the current (4th) quarter.
Fortescue shares rose 1.1% to $5.39.
