Fenix Resources (ASX:FEX) has secured further iron ore hedging contracts from January 2024 through to June 2024 at a fixed price of $163.50 per tonne.
The $166.59 million market capitalisation company says the contracts are for a total of 150,000 tonnes of iron ore, structured as 25,000 tonnes per month for the 6-month period.
These new contracts have been added to Fenix’s current iron ore hedge book of 240,000 tonnes consisting of 60,000 tonnes per month until December 2023 at a fixed price of $170.10 per tonne.
The iron ore spot price is currently US$123 ($190) per tonne.
Hedging arrangements consist of swap contracts between Fenix and Macquarie Bank, which are cash-settled at the end of each month for an amount equivalent to the difference between the fixed price of the contracts and the monthly average Platts TSI 62 Index converted to AUD.
Fenix says its hedging arrangements are consistent with its price protection policy designed to support the medium-term profitability of production whilst maintaining positive exposure to iron ore prices.
Fenix Resources is an ASX-listed iron ore producer focused on its assets in the Midwest mining region of Western Australia. As of 30 June 2023, the company had $76.1 million cash at hand, according to its latest quarterly report.
Write to Aaliyah Rogan at Mining.com.au
Images: Fenix Resources
