Fortescue urged to reduce exports, raise iron grades

Original article by Peter Ker
The Australian Financial Review – Page: 27 : 4-Nov-17

Andrew Hines has urged Fortescue Metals to lift its iron ore grades, even if that means reducing the level of its exports. Hines, an analyst with Evans & Partners, says doing this would help the level of pricing discounts applied to its product. He notes its recent strategy of lowering the grade of its product has reduced its production costs, but at the expense of the price it gets for its shipments. Hines says a "perfect storm of factors", including higher energy and transport costs, could see Fortescue posting a loss in fiscal 2019, compared to the $US2.1 billion ($A2.7 billion) net profit it announced in August.


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