* Fortescue logs 5% increase in iron ore shipments
* Fortescue says approval process for Queens Valley has
* More global stimulus expected to drive COVID-19 recovery -
MELBOURNE, Oct 29 (Reuters) - Australia's Fortescue Metals
Group Ltd posted a 5% rise in first-quarter iron ore
shipments on Thursday, fed by robust Chinese demand for the key
ingredient in steelmaking, which an executive said was also
improving elsewhere in Asia.
Iron ore prices have stayed buoyant this year despite a
coronavirus-induced slump in demand for most commodities, as the
world's top metals user China ramped up infrastructure spending
to counter the economic shock from curbs against coronavirus.
Signs are emerging of a recovery in other steel-making
markets, said Greg Lilleyman, chief operating officer at the
world's fourth largest iron ore producer.
"Steel-making activity is starting to pick up across Japan
and Korea recently," he told a news briefing.
Peer Rio Tinto had warned in October that a virus
resurgence was putting global economic growth at risk, and that
steel production outside China had dropped sharply.
Iron ore prices have tempered from last month's five year
highs, given easing coronavirus-related supply restrictions and
lower stimulus spending from China, although analysts anticipate
further global easing measures could support prices.
"We expect FMG will find support from investors given the
price environment as well as potential for additional stimulus
(driving demand)," RBC analysts said in a note.
Fortescue's Chief Executive Elizabeth Gaines said on
Thursday she welcomed the approach by investors worth $10.2
trillion who said they had written to the boards of global
mining companies to better understand their engagement with
First Nations people after Rio Tinto destroyed an ancient
rockshelter in May.
In a government inquiry into the disaster, the Aboriginal
Wintawarri Guruma group said Fortescue was withholding royalty
payments of nearly A$2 million ($1.4 million) until it signed
off on mining leases at the firm's $287-million Queens Valley
project, home to many sacred sites.
"The Queens Valley approval process has recommenced," said
Gaines, adding that the move was the outcome of discussions with
Wintawarri, which Fortescue has met six times since June.
"We are working hard to facilitate the payment of those
The Perth-based miner shipped a record 44.3 Mt of iron ore
in the quarter ended Sept. 30, up from 42.2 Mt a year earlier,
and in line with UBS estimates of 44.1 Mt. It said it was
"well-positioned" to meet its full-year iron ore shipment
forecast of 175 million tonnes to 180 million tonnes (Mt).
Its ore fetched $105.77 per dry metric tonne (dmt) in the
quarter, up from $85 per dmt a year earlier, or 89% of the
average Platts 62% CFR Index, up from 86% last quarter.
That let it finish paying down debt, to hold $1 billion in
net cash. Five years ago net debt was $6.6 billion.
(Reporting by Anushka Trivedi & A K Pranav in Bengaluru and
Melanie Burton in Melbourne Editing by Vinay Dwivedi, Shounak
Dasgupta and Amy Caren Daniel)