Fortescue Metals Group (ASX: FMG) has reduced its C1 costs by 17% over the previous quarter to US$36.01 per wet metric tonne in the June 2013 quarter while increasing production by 24% to 25 million tonnes.
Iron ore production hit 120 million tonnes per annum in the month of June, 5Mtpa higher than expectation.
Total iron ore shipments for the year ended 30 June 2013 were 80.9Mt, 41% higher than the prior year.
It also realised an average CFR price of US$113 per dry metric tonne in the quarter, reflecting continued strength in the iron ore market.
Expansion projects remain on budget and schedule to initially achieve production at the 155mtpa run rate across the supply chain by end December 2013 and sustainably produce at 155mtpa post the wet season in March 2014.
Fortescue is continuing discussions regarding the sale of a minority interest in its rail and port assets while its capital expenditure for the 2013 financial year is US$6.2 billion, US0.1 billion lower than expected.
The company said the increased production is due to its investment in mining and ore processing facilities that maximise product quality and improve efficiency to deliver sustainable lower operating costs.
Commissioning of the wet plants at the Chichesters have enabled the mining of lower cut off grades whilst maintaining product quality.
This, together with the introduction of Solomon ore to produce the Fortescue blend, a key element of the revised product strategy, underpins ongoing product and cost benefits.
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