Australia’s FMG has reported 44.7 million tonnes of iron ore shipments in the June quarter at a record low C1 cash cost of just $12.16/wet metric ton. Realised prices remain well below 62% Fe benchmarks but the company still hopes to cut costs further in the coming financial year, Kallanish notes.

“Leading into FY18, we are well positioned to continue our focus on productivity and efficiency initiatives to improve costs, to invest in the long term sustainability of our core iron ore business and maintain production levels,” says ceo Nev Power. Shipments were up 13% from the previous quarter and 3% year-on-year, while cash costs were down -7% on-quarter and -15% year-on-year, the miner says.

In the financial year ending June 2018, FMG plans to ship around 180mt of ore, up from around 170mt in the year ending June 2017. It also plans to maintain C1 costs in a range of $11-12/wmt, compared with an average of $12.82/wmt over the financial year ending last June. This is based on an average AUD/US exchange rate of $0.75/AUD and a crude oil price of $53/barrel for West Texas Intermediate (WTI).

The miner’s lower grade products earned an average $53.27/dry metric ton cfr China over the year to June 2017. This was just 77.75% of the $68.51/dmt cfr Qingdao average of the Kallanish index for 62% Fe Australian fines.