Therefore their current EBITDA per tonne is US$18.
QIO (Bloom Lake) is actually earning very close to the CFR China price for it's 66% Fe ore (with Sojitz making a small margin per tonne above this).
QIO are currently realising US$91/t for their 66% Fe iron ore.
I believe total production costs (including shipping) are currently in the high US$50's (lets say US$59/t).
Almost half of this is ocean freight costs which are currently up to US$28/t - see article below which relates to a recent capesize shipment from Port Cartier, Quebec to China (Arcelormittal)
Therefore if my assumption of total costs at US$59/t is correct (lets hope it's not higher), then QIO/Bloom Lake current EBITDA per tonne is US$32.
CIA owns 63.2% of QIO, therefore CIA's EBITDA per tonne is US$20.
In summary, it appears that not only is Bloom Lake considerably more profitable (gross per tonne) than FMG but even CIA's share of the mine is making a higher margin per tonne than FMG.
This comparison is not meant to cast FMG in a negative light - there is much to like about the company - fully-automated, low cost operation with their own ships, Chairman Twiggy & a fully franked dividend!
It's meant to show that CIA, even in it's infancy, is looking pretty good.
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CIA Price at posting:
$1.38 Sentiment: Buy Disclosure: Held
(20min delay)
