As Fortescue Metals Group advances its Iron Bridge magnetite project, we contemplate what impact the high-grade mine will have on the local market.
While Grange Resources produces magnetite from its Savage River mine in northwest Tasmania, and there are a handful of exploration companies looking to produce the iron ore derivative locally – such as Hawsons Iron and Magnetite Mines – the majors have largely been hematite producers in the past.
While magnetite is generally lower grade in the ground than hematite, it has less impurities and can typically produce higher-quality products once processed.
And Fortescue Metals Group believes it will be able to produce a 67 per cent iron (Fe) magnetite product from Iron Bridge.
For context, BHP’s Western Australian Iron Ore (WAIO) operations have historically produced iron ore at 61 per cent Fe. This will increase to 62 per cent once BHP’s South Flank operation has ramped up.
As steelmakers implement processes to achieve their net-zero goals, they will be prioritising high-grade Fe products over their low-grade alternatives. This is because high-grade products require less energy to process.
This puts Iron Bridge at the front of the queue, and with 22 million tonnes (Mt) of the project’s 67 per cent Fe product due each year, Fortescue is set to make some significant windfalls from the mine.
Iron Bridge has been beset with delays, but Fortescue recently celebrated first wet concentrate production from the project.
“This is a significant milestone for Fortescue as Iron Bridge represents our entry into the highest-grade segment of the iron ore market, providing an enhanced product range while also increasing production and shipping capacity,” Fortescue chief executive officer Fiona Hick said of the first wet concentrate milestone in the company’s March 2023 quarterly.
Fortescue shipped a record 143.1Mt in the nine months to March 31, 2023, which came as 46.3Mt was shipped during the March quarter.
The company moved product at an average of $US109 per dry metric tonne (dmt) during the March quarter, equating to 87 per cent of the average Platts 62 per cent CFR Index. This was up from $US87/dmt achieved during the December quarter of 2022.
Iron Bridge is the first of a new wave of emerging magnetite mines set to come online in Australia, with its introduction sure to make other major miners sit up and take notice, while inspiring other local magnetite aspirants to stay the course with their projects.
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