Mount Gibson Iron Limited (ASX: MGX) is the latest ASX iron ore miner to release its quarterly activities report. The miner revealed total ore sales of 1,026kwmt (thousand wet metric tonnes) for the March quarter, up from 402kwmt in the March 2019 quarter.
Iron ore price resilient
Iron ore prices have held up throughout the coronavirus crisis and firmed again this week as Brazilian giant, Vale, slashed its 2020 production guidance. Vale's cut removes 20 million to 25 million tonnes from global iron ore supplies this year. This comes on top of the 6 million tonne cut by Rio Tinto Limited (ASX: RIO) due to damage caused by Cyclone Damien to its Pilbara operations.
The iron ore price has also been supported by strong imports from China. Iron ore imports to China dipped by just 1.3% in March, while for the first quarter imports were up 1.3%.
ASX iron ore majors
Rio Tinto reported a rise in exports in the March quarter, which were up to 72.9 million tonnes from 69.1 million tonnes in the prior corresponding period. Rio Tinto's March quarter exports were, however, down 16% from the December quarter, with recovery across the network required following Cyclone Damien in February.
BHP Group Ltd (ASX: BHP) reported a drop in iron ore production of 1% in the March quarter, with production impacted by adverse weather conditions. On a year-to-date basis, however, BHP's iron ore production has risen 3%. The mining giant announced yesterday that its full-year iron ore production guidance remains unchanged at 242 million tonnes to 253 million tonnes.
Mount Gibson sales and operations
Mount Gibson recorded sales revenue of $82 million for the March quarter, with prices above those of the December 2019 quarter. Nonetheless, mining operations have not escaped the coronavirus unscathed; non-essential work has been deferred since mid-March to reduce site manning levels.
Mount Gibson's operations on Koolan Island in the Kimberley region and at Extension Hill and the Geraldton Port in the Mid-West region have continued. Increased costs, however, have been incurred as a result of increasing travel and operating constraints.
Mount Gibson had cash and liquid investments of $402 million at the end of March, up from $398 million at the end of December. In February, the miner released its 1HFY20 results recording a $44.6 million after-tax profit on total iron ore sales of $230 million.