Fortescue Metals Group (ASX:FMG) is sticking to its sales guidance for the year ending next June, even though it witnessed a 3% decline in shipments during the three months leading up to September. Additionally, the company anticipates a reduced contribution from its troubled Iron Bridge magnetite mine in the upcoming year.
The company disclosed this information to investors during a site tour starting today (October 13), revealing that it shipped 45.9 million tonnes of ore in the September quarter, a 3% decrease from the same quarter in 2022-23, which saw 47.9 million tonnes.
Fortescue attributed this shipment reduction to increased maintenance activity and lower stocks at the port, following the record shipments of 192 million tonnes achieved in the year ending in June.
Fortescue’s guidance for total iron ore shipments in FY24 remains unchanged at 192 – 197 million tonnes, which includes approximately 5 million tonnes from Iron Bridge (100%), previously estimated at 7 million tonnes. The revision for Iron Bridge reflects challenges in production due to issues with the raw water pipeline and plant rectification work, impacting availability in the September 2023 Quarter. Nevertheless, the ramp-up to full production capacity of 22 million tonnes per annum is on track and expected within 24 months.
The additional two million tonnes of ore are expected to come from Fortescue’s existing mines.
In the 2022-23 results, Fortescue devalued Iron Bridge by $1 billion pre-tax due to higher costs and delays in the ramp-up.