Ann: Trading Halt, page-69

Hi Rookie,

If you have never tried to feed low grade concentrate into a refinery you will likely not know the true importance of concentrate values.

Grade is king and concentrate grade = revenue.

In the most simplistic form look at Iron ore.

FE smelting is much simpler than a complex refining process but look at the discount that FMG have to take for their low grade iron ore @ 56% or even 58% compared to the benchmark 62%. It's massive! It's due to the complexities of processing this and processing and dealing with the increased waste.

Higher grade is much more desirable and in complex processes can be a game changer.

Iron ore players are now spending big $$ in Capex and Opex to increase the purity of their product.