Further to my earlier cost analysis I now make the following comments.
My previous calculations included an additional cost for shipping, but my reading of the realised price of $US83.05 means that shipping costs are already deducted.
The cost has been reduced to $US52. Now this is probably a result of the increased total sales to 2.2m tonnes.
We are now looking more like having 9m tonnes exports this year. So this reduces the repayments and finance costs on a per tonne basis.
Revised costs now per tonne:
$US52.00 base cost
$US 1.00 admin
$US.25 sales
$US 1.40 Royalties
$US 0 Shipping
$US10.55 Finance costs $US14.00 Repayments
$US79.20 TOTAL excluding depreciation
Sales $83.05
Margin $US4.30 per tonne or $US38.7m
But how long can Fe price stay at $83.05?
Check to see if I have made any mistakes. Thanks.
GBG Price at posting:
2.9¢ Sentiment: None Disclosure: Held
