Fortescue delivers shipment record

Fortescue Metals Group will steam home to another record year for iron ore shipments while giving itself yet more time to get Iron Bridge up to speed.

Issuing quarterly production figures to the market on Thursday morning, Fortescue said it had shipped 48.9 million tonnes during the final months of the 2023 financial year.

That contribution lifted Fortescue’s annual shipments to 192mt, marking a fourth record year for the company in terms of output and meeting the top end of guidance.

Looking to FY24, Fortescue plans to hit between 192mt and 197mt. 

C1 costs per wet metric tonne came in at $17.54, falling within anticipated guidance but representing a 10 per cent increase on the same metric for the year prior.

These costs are tip to creep further upwards towards the $US18 to $US19/wmt band, in what new chief financial officer Christine Morris said reflected higher labour rates and mine development.

Earlier this week, Fortescue marked first ore on ship from its Iron Bridge magnetite project in the Pilbara, a project with its fair share of delays and cost blowouts driven by inflationary pressures and general processing complexities in refining the ore to a higher grade. 

Costs swelled from an initial $US2.2 billion estimate before eventually landing on a $US3.9 billion price tag in February 2023. First ore was produced in May, despite an initial target start in the first half of 2022.

C1 costs for the higher-quality magnetite product were not outlined fo FY24 due to higher fixed prices and low volume of shipments, Ms Hick told analysts. 

Fortescue chief executive officer Fiona Hick had alluded to complexities in the ramp-up process earlier this week, with the 12-to-18 month ramp-up target now pushed out by a further six months per the company's update today. 

"FY24 shipments are anticipated at approximately seven million tonnes (100 per cent basis) and the ramp up to full production capacity of twenty-two million tonnes per annum is expected within twenty-four months," it was reported. 

Overseas, Fortescue mined and loaded first ore from its nascent Belinga project in Gabon during the quarter. 

First shipment, expected to be about 50,000 tonnes, is on track for the end of this calendar year. 

Fortescue has allocated up to $US500 million to develop Iron Bridge and Belinga, with up to $US2.1 billion expected to be spent on hub development. 

Fortescue shares were off about 1.39 per cent during lunchtime trading at $23.40 apiece.