The Iron Bridge project is expected to produce 22mtpa of high-grade 67% Fe magnetite concentrate. Credit: Fortescue Metals Group.

Australian iron ore company Fortescue Metals Group has started cutting workers to maintain cost position, reported Reuters citing a person familiar with the development.

Nearing completion of its Iron Bridge magnetite project in Western Australia, the company could axe more than 100 workers, according to local media.

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This is notably lower than last month’s projection by Reuters, which said that the miner is planning to cut its workforce by 1,000.

In an email response to the news agency, the firm said: “Projects such as Iron Bridge are coming into production phase soon while our work in Gabon is just kicking off. As this occurs, project staffing naturally ebbs and flows.”

A Fortescue spokesman was quoted by Sydney Morning Herald as saying that the redundancies form part of the ‘business as usual for rapidly evolving global companies’.

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The spokesman said: “We are always looking for opportunities for continuous business improvement to maintain our industry-leading cost position.”

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The job cuts come amid reduced profits posted by global mining giants due to a decline in iron ore prices as a result of China’s Covid-19 curbs.

In the six months ending 31 December 2022 (H1 FY23), Fortescue reported a 15% decrease in underlying net profit after tax to $2.37bn amid this iron ore price rout and increasing production costs.

Currently under development, the miner’s $3.6bn-$3.8bn Iron Bridge Magnetite Project is expected to produce 22 million tonnes per annum (mtpa) of high grade 67% Fe magnetite concentrate.

Planned to be commissioned in the March 2023 quarter, the project is an unincorporated joint venture (JV) between FMG Iron Bridge subsidiary FMG Magnetite (69%) and Formosa Steel IB (31%).

FMG Iron Bridge is owned by Fortescue Metals (88%) and Baosteel Resources International (12%).