Arrium shipments fall on Southern Iron close
PERTH (miningweekly.com) – ASX-listed Arrium Mining and Materials has reported a 20% quarter-on-quarter drop in iron-ore shipments to 2.2-million tonnes for the quarter ended September, on the back of the mothballing of its Southern Iron operations, in South Australia.
The average grades of the ore shipped declined by 0.7% quarter-on-quarter.
However, hematite ore mined from the Middleback Ranges was up 13% during the quarter, to 2.6-million tonnes, reflecting Arrium’s business focus on the lower-cost Middleback Ranges operation.
Arrium told shareholders on Monday that significant progress had been made during the quarter on resetting the cost base to achieve a targeted average cash breakeven price of $47/t for the 2016 financial year. This included targeting an average loaded on-ship cash cost of A$35/t, a total cash cost of A$53/t, and capital expenditure (capex) of A$6/t.
The company had previously flagged plans to reduce capex by A$70-million from its previous 2016 financial year targets, with further reductions of about A$140-million planned between 2016 and 2019.
While the miner was targeting sales of between nine-million and ten-million tonnes in the 2016 financial year, the capex reduction was expected to result in sales volumes of between six-million and eight-million tonnes between 2017 and 2019.
Arrium noted on Monday that the company continued to focus on opportunities to reduce costs, improve efficiency levels and optimise cash generation.
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