Fortescue's December qtr iron ore output up nearly a third
Australian miners, led by Rio Tinto and BHP Billiton , are ramping up production of the steel-making ingredient, banking on their lower-cost operations to see them through any softening in demand growth from Asian consumers.
Fortescue's shipments climbed to 19.6 million tonnes in the three months to Dec. 31, 2012, from 14.8 million in the corresponding period a year ago, the company said, meeting analysts' expectations.
Fortescue said it expected volatile market conditions in China to stabilize in the near term.
"Steel mills are readjusting their raw material stocks to maintain more sustainable stock levels. With China's new leadership starting to rejuvenate programmes of economic growth and urbanization, steel demand is expected to increase and support iron ore prices," the company said in a statement.
Fortescue, which carries around $12 billion in long-term debt, last month reinstated expansion work on its Kings deposit after deferring it earlier in the year when iron ore prices halved to less than $90 a tonne.
A recovery to nearly twice that price in recent weeks led the company to restart the project, which will add 40 million tonnes a year to Fortescue's overall yield and enable it to reach its 155-million-tonne target.
"The scale benefit of adding these low cost tonnes is expected to significantly reduce Fortescue's overall cost of production," the company said.
In the final month of 2012, the
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