Fortescue Metals Group Ltd., Australia’s third-biggest iron ore producer, reported third-quarter shipments rose 59 percent, missing analysts estimates, after the completion of an expansion.
Shipments were 30.8 million metric tons in the three months ended March 31, from 19.4 million tons a year earlier, the Perth-based company said today in a statement. That was lower than the median estimate of 32 million tons from three analysts surveyed by Bloomberg.
Prices plunged into a bear market during the quarter as inventories ballooned to the highest ever in China, the biggest buyer. Australia’s biggest junk-bond issuer is cutting liabilities as rising global supply is forecast to move the iron ore market into surplus this year.
“Whilst there was short term volatility in the March 2014 quarter, China’s demand for iron ore remains strong with the government committed to continued economic growth and urbanization,” the company said.
Mined output declined 8 percent to 29.6 million tons, “largely due to the impact of seasonal wet weather on production and a focus on working capital management,” Fortescue said according to the statement.
The company’s shares rose 1.1 percent to A$5.39 in Sydney, trimming the decline for the year to 7.4 percent.
Fortescue, which today said it has completed an expansion to nearly triple capacity to 155 million tons, plans to produce 41.6 million tons of iron ore in the June quarter for annual output of 127 millions during fiscal 2014.