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Fortescue (ASX:FMG) share price in focus on Q3 update

The Fortescue Metals Group Limited (ASX:FMG) share price is in focus after the ASX iron miner released its quarterly March 2023 update. 

The Fortescue Metals Group Limited (ASX: FMG) share price is under the spotlight after the ASX iron ore miner released its quarterly March 2023 update.

Not only is Fortescue a major iron ore miner, but it also has plans for green energy projects around the world.

Fortescue’s Q3 update

Fortescue announced that in the FY23 third quarter, iron ore shipments totalled 46.3 million tonnes (virtually the same as the third quarter of FY22), contributing to record shipments for the nine months to 31 March 2023 of 143.1 mt.

It achieved average revenue of US$109 per dry metric tonne (dmt) of iron. This meant, for its lower grade iron, it achieved a price of 87% of the average iron ore price (Platts 62% CFR Index for the quarter). That’s good news for the Fortescue share price.

The production (C1) costs were US$17.73 per wet metric tonne (wmt), 2% higher than the first half of FY23. That’s not surprising considering the inflationary environment we’re currently in.

Other highlights

Fortescue said that the first wet concentrate was produced from its ore processing facility at the Iron Bridge project on 21 April 2023. Iron Bridge is a new location that could produce 22mt each year, of high grade iron.

It has also signed the mining convention for the Belinga iron project in Gabon, with the first mining planned in the second half of the 2023 calendar year.

Turning to the green side of the business, Fortescue Future Industries (FFI), it said that construction works have been completed on the electrolyser manufacturing facility in Gladstone. FFI has also made continued progress on its “priority projects” in the US, Australia, Brazil, Kenya and Norway. It has also secured renewable power with a purchase agreement with Statkraft in Norway.

Final thoughts on the Fortescue share price

Fortescue is producing a lot of iron and making progress on its green initiatives. I don’t think it’s at a great price to buy today, but I do like what the business is doing. I’m hoping that the iron ore price can stay above US$100, enabling the business to fund good dividends and its green energy ambitions. But, if the iron ore price fell to US$90, it could mean a good time to buy.

At the time of publishing, Jaz owns shares of Fortescue.
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