AAP Finance

Andrew Forrest's Fortescue flags major asset writedown

By Derek Rose

Jul 31, 2026

Fortescue Metals' iron ore operations in WA's Pilbara region — Fortescue will mark down the value of its Iron Bridge magnetite operation by $1.07 billion. -AAP Image

A major mining company directed by billionaire Andrew Forrest will declare a billion-dollar writedown of a three-year-old, state-of-the-art iron ore mine in the Pilbara.

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Fortescue will mark down the value of its Iron Bridge magnetite operation 145km south of Port Hedland by $US750 million ($1.07 billion), or $US525 million ($747 million) after tax.

A joint venture between Fortescue and Formosa Steel, Iron Bridge produces the high-grade iron ore known as magnetite, which Fortescue has been keen to mine as it improves furnace efficiency and lowers emissions during the steelmaking process.

But the mine has never achieved its nameplate capacity of 22 million tonnes of magnetite, with Fortescue on Friday predicting it would produce just 11 to 14 million tonnes in 2026/27 and more than 16 million tonnes in 2027/28.

Fortescue said it decided to take the writedown after a standard year-end asset review that included a range of production scenarios for Iron Bridge, also known as the North Star mine.

Fortescue said it had produced 52.7 million tonnes of iron ore in the June quarter, taking its total shipments to 201.3 million for 2025/26, including nine million from Iron Bridge.

"Breaking through 200 million tonnes of shipments for the first time is a significant achievement and a credit to every person across the business," said Fortescue chief executive for metals and operations Dino Otranto.

"Results like this don't happen by accident."

The company forecast it would produce 197 million to 207 million tonnes of iron ore in 2026/27, including the contribution from Iron Bridge.

RBC Capital Markets analyst James Redfern called that guidance a "touch light", at one per cent below consensus estimates of 205 million tonnes.

Fortescue also predicted its cost to mine, process and ship a wet tonne of iron ore would fall between $US20.50 and $US21.75 in 2026/27, up from $US18.74 in 2025/26.

Mr Redfern said cost guidance was six per cent above consensus of $US19.86 per wet tonne.

Fortescue said the increase was attributed to higher diesel costs and industry inflation.

In 2025/26, Fortescue sold the iron ore it produced for an average of $91 per tonne.

In early afternoon trading, Fortescue were down 3.5 per cent to $18.21.