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Total iron ore production amounted to 4.15 million tons

Ferrexpo, an iron ore company with assets in Ukraine that is listed on the London Stock Exchange, reduced its production of iron ore pellets by 36% in 2023 compared to 2022, to 3.845 million tons. The total production of iron ore products amounted to 4.15 million tons. This is stated in Ferrexpo’s production report for the fourth quarter of 2023.

In the fourth quarter of 2023, the company produced 627 thousand tons of pellets, down 50% quarter-on-quarter. In particular, 577 thousand tons of premium pellets were produced from own concentrate (65% iron content) and 50 thousand tons of pellets – from third-party concentrate (65% iron content). Thus, during the year, 100% of pellets production was represented by products with 65% iron content.

“Throughout the year I have maintained that it is the resilience and commitment of our workforce that has ensured our assets remain operational. Once again, due to their steadfast determination that today we are reporting fourth quarter iron ore production of 677 thousand tonnes, and a total 4.1 million tonnes for the year,» Lucio Genovese, Interim Executive Chair of Ferrexpo, commented.

According to him, even with the onset of winter, the company operated one or even two production lines to continuously supply products to customers around the world. During the fourth quarter, Ferrexpo changed its production structure to meet customer needs and produced high-quality pellets and iron ore concentrate.

«In view of the hugely challenging situation that we faced during the past year, I believe that this is an exceptional performance and I am proud of our collective achievements,» Lucio Genovese added.

The company is still suffering losses due to the lack of access to Black Sea export routes, but Ukraine’s recent success in opening export corridors through the Black Sea has allowed some companies to resume shipments from certain ports. If sea exports resume, Ferrexpo plans to launch an additional production line and resume deliveries to customers in the Middle East and Asia.

In addition, Ferrexpo notes that iron ore prices rose by more than 20% during the last quarter due to China’s support for more steel-intensive sectors of its economy, and continued to hold up until the new year. There are also first signs of growing demand for pellets in Europe.

«These factors combined could be supportive of our large fixed cost base and higher logistics costs. In my opinion, improved demand and higher prices bode well for the year ahead for Ferrexpo,» the Chairman of the Board of Directors of Ferrexpo summarizes.

In 2023, the Group produced 307 thousand tons of merchant concentrate, up 147% year-on-year. In the fourth quarter, the production of such products decreased by 49% q/q – to 50 thousand tons.

As GMK Center reported earlier, in 2022, Ferrexpo reduced its pellet production by 46% year-on-year – to 6.053 million tons. In the fourth quarter, pellet production decreased by 86% y/y – to 417 thousand tons, including 18% y/y decrease in DR pellets – to 353 thousand tons.

Ferrexpo is a Swiss-based mining company with iron ore assets in Ukraine. It produces and exports high-quality iron ore pellets for steel production. Its production assets include Poltava Mining and Yeristovo Mining (holding a 100% stake each). The company is also developing Bilanivsky Mining.