Australian iron ore giant Fortescue Group recently released its fiscal 2022 results, which showed the group's shipments and turnover reached a record high of 189 million tons during the fiscal year. But the group's sales were just $17.4 billion, down 22% from a year earlier, thanks to falling iron ore prices. In fiscal 2022, FMG Group's net profit was just $6.2 billion, down 40% from a year earlier
China is one of the main reasons Fortescue's iron ore profits have fallen. After all, China is the world's largest importer of iron ore, and also the largest importer of Australian iron ore, and Chinese demand has a significant impact on Australian mining companies.
In 2022, China's demand for Australian iron ore also dropped significantly due to the impact of the pandemic and a weak real estate sector. It is understood that in the first half of this year, China's national crude steel production was 527 million tons, down 6.5% year on year.
In fact, iron ore related enterprises are affected, according to the data, Rio Tinto Group achieved a net profit of $8.9 billion in the first half of 2022, a decline of 28% compared with the same period of 2021; Vale's second-quarter earnings were also weak, down $840 million from the first quarter.
Feeling the pressure of its lack of a Chinese market, Fortescue says China, which produces more than 50% of the world's steel, remains its core market. Rio Tinto also said it was optimistic about the Chinese market. By implication, the iron ore giants are saying that their ability to make money depends largely on China.
