Insight

Value-in-use adjusted iron ore costs Q4 2017

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Report summary

Global average value-in-use (VIU) adjusted costs are US$42.07/tonne in Q4 2017, up 17% compared to a year ago. The major driver of VIU-adjusted costs over the past year has been the increased price spread between high-grade and low-grade ore and increased penalties for impurities. Australian costs have risen the fastest owing to the high proportion of low-grade ore shipped. While Brazilian cost rises have been muted as improved premiums for Brazil high-grade ore have largely offset sea-freight and other cost increases. The associated Excel download provides mine-by-mine and company VIU adjusted costs. As well as our full China cost curve on a VIU-adjusted basis.

What's included

This report contains

  • Document

    China_delivered_VIU_adjusted_costs_Q4 2017.xls

    XLS 1.65 MB

  • Document

    Value-in-use adjusted iron ore costs Q4 2017

    ZIP 766.53 KB

  • Document

    Value-in-use adjusted iron ore costs Q4 2017

    ZIP 766.53 KB

Table of contents

    • Two-tier iron ore market is likely to persist
    • Iron ore margins remain strong
    • Chinese mines struggling to breakeven

Tables and charts

This report includes 10 images and tables including:

Images

  • 2017 value-in-use adjusted cost curve (CFR China, 62% Fe fines equivalent)
  • VIU adjusted cash cost by country (CFR China)
  • VIU adjusted cash cost by percentile (CFR China)
  • Seaborne iron ore cash costs by operator (CFR China, unadjusted for quality)
  • Seaborne iron ore cash costs by operator (CFR China, VIU adjusted)
  • Change in VIU adjusted costs for selected operators from Q4 2016 to Q4 2017
  • Fe grade adjustments
  • Alumina and silica discounts
  • Cash operating margins
  • 2017 China value-in-use adjusted cost curve (62% Fe fines equivalent)

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