Fortescue Metals Group (ASX:FMG,OTCQX:FSUGY) broke a personal record in Q2 with shipments of 46.6 million tonnes (Mt), including 4.7 Mt of its West Pilbara Fines product.

In a quarterly production report, Fortescue announced that its shipments for the 2019 fiscal year hit 167.7 Mt, coming in 1 percent lower than the year before. The company attributed the minor drop to Cyclone Veronica, which hit Western Australia in March and impacted several iron ore businesses.

Also reduced — but in a good way — were cash production costs, which came to US$12.78 per wet metric tonne (wmt) over the quarter. This represents a 5 percent drop from the March quarter’s cash production costs of US$13.51 per wmt.

In a statement, Fortescue CEO Elizabeth Gaines said the reduced cash production costs in combination with the record shipments have reinforced the company’s position as “the lowest cost producer.”

“With healthy iron ore inventory levels across the supply chain we are well positioned to continue delivery of our highly valued product mix to customers in FY20,” she said.

“Strong demand for our 60.1 percent iron content product West Pilbara Fines continues, and we remain focussed on our integrated operations and marketing strategy to optimize product mix to meet the needs of our customers,” Gaines continued.

The last quarter also saw the company’s Queens Valley mining area receive development approval. It is set to be part of the pre-existing Solomon Hub in Western Australia.

Docketed to cost US$287 million, the extra space will have a 10 to 15 year mine life and will focus on the continued production of Fortescue’s low-alumina Kings Fines product.

“Fortescue’s growth and development projects at Eliwana and Iron Bridge remain on schedule and budget. In addition, our ongoing investment in autonomy, relocatable conveyors and other initiatives such as the Queens Valley development will continue to deliver enhanced returns to shareholders,” Gaines added in the release.

Fortescue shares fell 5.5 percent on the ASX on Thursday (July 25), ending the day of trading at AU$8.25 per share. As of 4:36 a.m. EDT on Thursday, iron ore was trading at US$120.09 per tonne.

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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.