Fenix Resources (ASX:FEX) has shipped the first batch of iron ore from its WA-based ‘Twin Peaks’ play.
The first shipment contained 59.2K tonnes of +60%Fe ore which Fenix said on Thursday it expects to directly contribute to revenues.
Fenix was the beneficiary of an A$60/t logistics and ports payment plus a further profit share payment arrangement.
Management was quick to highlight this solidifies the second production source for Fenix in WA’s Mid-West.
“Our partnership with 10M Pty Ltd has supported their transition from explorer to producer and is unlocking value for both companies as well as growing the Mid-West economy,” Fenix chief John Welborn said.
“Fenix’s unique integrated mining, logistics and port services businesses provides an exciting platform for growth for both the Company and the many projects in the region seeking to advance to production.”
All of this comes at the same time Fenix is clearly shrugging off choppy weakness in the commodity price for iron ore.
Singapore SGX iron ore futures have hovered between $115/tn and $120/tn for the last fortnight, shirking off valuations closer to $130/tn in the not-too-distant-past.
Even with prices near $130/tn, some analysts were calling that overpriced – and others tip the commodity to fall below the $100/tn mark.
(Others, of course, see it going higher.)
So, why all the volatility and mixed consensus?
The answer: a Chinese economy that appears to the outside world to be floundering.
This week’s Chinese ‘Two Sessions’ meetings were defined by upbeat and optimistic language but investors didn’t love the fact China continues to make big claims without any real planning or framework.
Many were hoping for talk of construction stimulus but China appeared to be more interested in talking about growing a domestic Artificial Intelligence sector.
Whether or not that’s what it really needs to be worrying about remains to be seen – though, that could stimulate Chinese stock markets at least.
If only stock markets informed the economy, and not the other way around.