Twiggy is one of the smartest people in the country and knows...

Twiggy is one of the smartest people in the country and knows how to make a buck but I will listen to you and your rhetoric....

Grade is king

That grade discount is one of the reasons that, despite the cost, Iron Bridge is a priority for FMG.

Magnetite is costlier to extract than direct shipping hematite ore, but after processing can be delivered to customers at premium grades.

Iron Bridge concentrate would carry 67 per iron ore content, with FMG reporting it will garner an anticipated premium to the already higher price Platts 65% Fe CFR Index.

“Iron Bridge represents a strategic investment with compelling returns for Fortescue and the Joint Venture,” FMG CEO Elizabeth Gaines said.

“It further enhances our range of products through our integrated operations and marketing strategy and increases our overall production and shipping capacity to meet strong demand from customers.

“The iron ore market fundamentals support the investment in the Iron Bridge project, and we anticipate strong demand for this high value-in-use product, which will attract a premium to the Platts 65% Fe CFR Index.”

The Chinese-owned Sino Iron and Karara projects in WA are already operating in the magnetite space.

On the listed junior end of the spectrum Grange Resources (ASX: GRG) operates the Savage River magnetite mine in Tasmania, and commands a roughly 30 per cent premium on benchmark 62 per cent prices.

In the March quarter it sold 616,000t of high-grade iron ore pellets at an average price of US$228.52/t.

It also owns 70 per cent of the Southdown Magnetite Project in WA.