2018 has been another good year for iron ore producers. Prices for 62% Fe fines have traded in a narrow range between US$63/tonne and US$78/tonne (CFR China) and will average US$69/tonne for the year. Average seaborne cash costs increased 3.6% in 2018 to US$35.8/tonne (CFR China). The higher cost was caused by an average US$2/tonne increase in ocean freight costs and a small rise in royalty costs on the back of higher iron ore prices. C1 costs (ie, costs excluding royalties and ocean freight) for seaborne suppliers actually fell 5% compared with 2017. Higher fuel costs were offset by improved productivity and weaker currencies. We expect further cost increases in coming years, mostly owing to rising ocean freight costs. C1 costs are expected to remain fairly stable as rising diesel prices and higher strip ratios will be largely offset by ongoing productivity gains especially from automation.