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An Australian mining and infrastructure giant with the 3rd biggest iron ore operations worldwide, Fortescue Metals Group is a force to be reckoned with in the metals and mining industry.

Fortescue Metals Group was founded in April 2003 by John Andrew Henry Forrest when he rebought his ancestral farmland. The company started with the goal of establishing a new port and rail system to connect stranded iron ore deposits. Then, it ventured into iron ore production in Pilbara region of Western Australia with its innovative exploration model.

Today, Fortescue, headquartered in Eastern Perth, operates in iron ore production and sea-borne trading. It has become an Australian multinational known for its culture, innovativeness, industry-leading development of infrastructure, and mining assets.

It exports more than 180-million-tons of iron ore yearly while harnessing the power of technology, ensuring efficiency, and committing to sustainability.

Here are some recent facts and statistics from 2021 that signify the stature of Fortescue Metals Group (FMG):

Let's now take a look at FMG's incredible journey of innovation and growth, right from the time it was founded in 2003 to today.


The New Force in Iron Ore

In 2003, for the first time in forty years in the Australian iron ore industry, FMG emerged as a unique demand-focused opportunity.

Since its inception, FMG has positioned itself to take advantage of opportunities, both as an owner of significant iron ore resources and as a competent provider of necessary infrastructure, calling itself "the new force in iron ore".

File:FMG Christmas Creek.jpg
Source: Fortescue Metals Group, Attribution, via Wikimedia Commons


FMG’s exciting adventure began with the chance to develop and commercialize historically trapped vast iron ore resources in Western Australia’s Pilbara area.

It invested in this endeavor due to rising worldwide iron ore demand. China was rapidly delivering on its ambition to become a significant long-term iron ore buyer. Its fast growth resulted in record-high demands for maritime supplies. Simultaneously, the large producers that controlled the supply aspects of the industry were caught off guard, and the Australian market was left behind.

By significantly decreasing the prior obstacles to participation, FMG pledged to assist the building of new freely accessible infrastructures in Pilbara to free trapped ore deposits and give alternative supply choices for demanding steel production worldwide.

The company also took a distinct style to transparent relationships, including consumers in critical designing and operational aspects from the start. It concentrated on fulfilling consumers' iron ore needs upfront and fair, maximizing efficiency from mining to the steel plant.

Working Early Beyond Borders

In August 2004, FMG signed a binding deal with China Railway Engineering Corporation" (CREC), one of Asia's biggest construction firms. This agreement was proposed to achieve the building of FMG's autonomous train system controlled by its subsidiary, The Pilbara Infrastructure (TPI), on a Build and Transfer basis.

Fortescue Metals gained the most significant leasehold foot in the Pilbara, encompassing slightly over 16,700 square kilometers by 2005 to grow its activities. The Pilbara is one of the most significant iron ore provinces in the world and strategically the nearest to the massive East Asian markets.

This was a major step towards reaching FMG's objectives of building a global Australian alternate for the delivery of ore into the leading economies of China, Japan, Korea, and Taiwan.

In terms of politics, FMG appreciated the backing of both the national and provincial governments in approving the development of two agreements that would encompass infrastructure and mining initiatives. The deal also helped the company establish itself as "The New Force In Iron Ore."

Public Listing

FMG moved from a junior explorer to a company listed in the Standard & Poors ASX 200 Index by 2005.

During this transition, the company separated the roles of Chairman and CEO. This division of responsibilities provided the CEO with the opportunity to focus his energy on delivering the project within the timeline and cost framework established.

On the end of the operations side, the macro-environment of continued high demand for iron ore gave rise in April 2005 to the most considerable annual price rise in the industry's history with a 71.5% price increase in fine ore prices for contract suppliers.

The continuing supply/demand imbalance provided Fortescue with a unique opportunity to progress its objective of becoming a major player in iron ore supply.

Also, the lack of procurement options continued to drive ever-increasing interest in Fortescue from major iron ore consumers and traders who are actively encouraged as new entrants.

Source: Fortescue Communications, CC BY-SA 4.0, via Wikimedia Commons

Innovation & Collaboration

In August 2006, FMG's programs successfully generated about AUD 3200 million, establishing a broad financial basis.

FMG's enviable position in the Pilbara, spanning 35,500 square kilometers, prompted it to pursue the region's first open-access linked port and railway system.

The company also saw an increase in personnel counts and the creation of a collaborative work atmosphere with important partner organizations (WorleyParsons and Roche Mining). Professionals from all these three teams operated at one site at FMG's East Perth facilities under the working name of Team 45, with a total of 350 individuals. FMG aimed to be a preferred employer, providing opportunities for employees to grow and thrive.

Moving Forward

By 2007, the corporation had built a robust financial foundation plan to lower expenses and reduce project risks. However, it had no impact on FMG's shareholder awards. The market valuation of FMG was acknowledged, as was the company's participation in the ASX 100 index and the worldwide MSCI index.

Furthermore, the capacity of FMG to reduce timetables to predetermined levels deemed unattainable by others was a clear strategic edge. What took others years to accomplish, took FMG months. Fortescue's ships were being filled with the gusts of global demand, aided by the economic impetus of East-Asian growth

Despite all of the individual accomplishments that have fueled FMG's growth in 2007, the creation of the FMG culture had been the most significant. The 'family' culture pervaded FMG like the Fortescue River did the Pilbara.

Along with striving to be the world's largest, most trustworthy, and low-cost manufacturer, FMG established its brand on the spindle of "doing what we say we're going to do" before everyone else believed it was feasible, meeting the obstacles that arose before it.

FMG port | Source: Fortescue Communications, CC BY-SA 4.0, via Wikimedia Commons

Going Global and Sustainable

FMG's marketing staff had spread worldwide by 2008, deepening its involvement with the global steel sector.

In fact, the company delivered its first-ever ore to China in the first half of 2008, which seemed unattainable at the time. The ore transport MV Heng Shan docked at the newly built Fortescue Herb Elliott Port at Port Hedland on May 15, 2008. The venture was deemed an operational accomplishment by banking specialists.

Also, FMG had the important responsibility for environmental protection as the Pilbara's largest lease operator. It established detailed land access contracts with Aboriginal groups across the project region and worked to ensure that its dedication to indigenous participation continues as a key focus.

Key Takeaway 1: Capitalize on Opportunities

Working with the right stakeholders at the right time made FMG the real new force in the iron industry of Australia.

It entered the market when the global demand for iron ore was significantly high, yet the producers in Australia could not overcome their limitations and make the most of the opportunity. Realizing that both the gap and potential were immense in the industry, Fortescue capitalized on the opportunity. Resultantly, in a very short span, it became a dominant name in the global iron ore market despite its competitors having several years of established businesses.

Flexibility To Progress In Storms

FMG had been delivering ore into a market with a growing appetite and exceptional rates since the beginning of 2009. China's apparently ravenous expansion fueled a flurry of activity in Australia and worldwide.

However, the global economic landscape shifted a few months significantly into 2009, demand dropped, and prices plunged.

Economy and Partnerships

FMG was hit hard by the global recession, which posed considerable hurdles in terms of shipping and management agreements with Chinese clients.

Despite shifting demand, the company pushed hard to sustain solid ties with Chinese steelworks and kept selling all tons of iron it could extract, refine, train, and export to China.

Simultaneously, Fortescue added 18,000 new stockholders in April, and Hunan Valin Iron and Steel Group Company Ltd became a strategic equity partner in the company.

Minerals, People, and Governments

By 2010, FMG had transported 40 million tons of ore, resulting in a 134% increase in operative working capital.

Additionally, the first phase of the Christmas Creek mines was supposed to be finished by 2011. FMG has also begun work on Fortescue's Solomon Hub, the world's finest undeveloped significant mineral deposit, which has nearly double the potential of the first two mine sites, Cloudbreak and Christmas Creek combined.

On the other end, FMG's human resources department continued to expand, with 2,225 employees working in exploration, mines, rail and port operations, and head office. Through its Vocational, Training and Employment Centre (VTEC) and its Summit 300 program, FMG also benefited Pilbara native people.

FMG's strength was endangered by Australia's Labor government's decision to impose a Resource Super Profits Tax. FMG, on the other hand, did not hesitate to oppose this ill-conceived tax, proposing a fairer Mineral Resources Rent Tax.

International Markets and Competition

In 2012, contending with Australian large projects were South America and the "new Pilbaras" in West Africa.

FMG, on the other hand, retained Australian dominance with its development to 155 mtpa. It did have a significant headwind from federal taxation policies, yet it survived. The CEO position was taken by Nev Power, who led the company towards a more stable position.

Then, in 2013, the iron sector saw extreme market volatility, dipping to record-low iron ore prices. FMG took swift action to protect the company's profitability and liquidity, cutting operational costs by $300 million right away. It reaffirmed its intention to finish the Christmas Creek project development and enable the low-cost Firetail deposit at Solomon.

If iron ore prices continued to collapse for an extended period, FMG had defined a hierarchy of alternatives to restructure the balance sheet, including the possible sale of tangible resources where the operations clearly contribute value for shareholders.

Additionally, China was dedicated to reducing short-term inflation which was encouraging for FMG.

Chinese Relationship

Despite a problematic phase of turbulence in 2013, FMG improved its net profitability by increasing throughput from its Chichester mine and lowering costs to US$44 per metric ton.

 In 2014, the FMG-China cooperation was strengthened by FMG's participation in the Boao Forum for Asia for the fifth year in a row. The company was optimistic that China, in particular, would continue its urbanization and industrialization processes, shifting from a dependence on exporting to a self-combusting engine of domestic usage to fuel demand.

Thus, FMG's long-term viability was assured by its distinctive, reliable, high-quality iron ore supply and solid partnerships.

Moving Forward Sustainably

FMG was able to reduce its operating costs by 21% in 2015, with sales surpassing US$9 billion. The River Fortescue gas-pipeline project had been constructed, and five terminals at the Herb Elliott port were commissioned.

Furthermore, FMG extracted 17.3 billion tons of mineral resources thanks to these initiatives and port improvements. FMG commemorates the eighth anniversary of its first successful ore ship in 2016, while also signing 1.8 billion AUD contracts with aboriginal firms and joint partnerships. FMG created "Fortescue's Trade Up," an apprenticeship program, to strengthen its human resources. FMG also prioritized environmental sustainability, reducing greenhouse gas emissions by 8%.

Key Takeaway 2: Develop Long-Term Partnerships To Sustain Growth

From 2009 to 2016, FMG fought many battles on economic, governmental, and competitive fronts, but it did not let its operations be affected.

With exemplary fast decision-making coupled with checking all the progress buckets, FMG's management sustained growth in harsh periods.

The way FMG dealt with economic and governmental effects via its close international relationships is another unique avenue that saved the day for FMG.


Family, Economy, Sustainability

FMG's close relations with its Chinese clients reached new heights in 2017 as the Australian government and other business leaders welcomed Premier Li's visit. The bilateral engagement highlighted FMG's strength as the bridge between the two economies.

Rising With Responsibility

FMG sponsored Asia's Boao Forum as a Diamond partner for the 9th time, continuing its influence over senior government ranks and its competitors.

As a part of its social responsibility, FMG supported initiatives on Cancer, Education, Modern Slavery via funding of AUD 400M to the Minderoo Foundation.

It also focused on creating parity between indigenous and non-indigenous groups of Australia by encouraging its vocational training program. A tax of AUD 2 billion was contributed, while contracts of AUD 1.95 billion were contributed to aboriginal groups.

FMG fostered a truly diverse culture across its ranks to level up organizational efficiency. 24% of managerial positions were female-led, while 50% of FMG's board members were female by 2017. The company was on track to create a supportive and encouraging workplace via its tailored job arrangements, where 94% of mothers returned from parental leaves in a single year.

Sustainable Success

FMG emerged as a successful Australian company transitioning from an exploration start-up to a global planner and construction expert. With its MRSE analysis ("Metalytics Resource Economic Analysis"), FMG became the world's lowest-cost provider of oceanic iron to China. MG's focus on safety and commitment to its people was its top priority. During all this progress, the core business of iron and its alignment on sustainable grounds in the long term was also on the top of the list at FMG by 2018. FMG's largest project called T155 opened its Eliwana mine and rail initiative by embracing technology-backed sustainability practices. 

Growing Strong

China's one belt and one road project provided FMG with a huge customer base as China consumed 50% of the world's steel. But the company remained one step ahead and started diversifying by shipping huge volumes to non-Chinese markets by 2018.

To the Australian economy, FMG played its part by investing over US$22B and paying AUD 4.5B royalties to the state.

As 2018 marked 15 years of Fortescue and 10 years of "FMG Sophi," the board of directors emphasized future investments and company culture enhancement. It also officially renamed itself "Fortescue Metals Group (FMG)" as it announced a core leadership team.

Exploring New Avenues With Safety

FMG recorded the lowest TRIFR ("Total Recordable Injury Frequency Rat") of 2.8 in 2019, highlighting its focus on the safety of its people.

Also, FMG's construction and designing supremacy was emphasized when Brazil's Vale faced a tailings dam disaster. Early-stage exploration and development in the copper industry attracted FMG's focus. It commenced drilling operations in Ecuador and Argentina for copper as it saw the opportunity with upcoming growth in demand for EVs.

Throughout 2019, FMG also continued to strengthen its multifaceted relationships with China through supply, procurement, investment, and academic, policy, and community engagement.

Fires And Viruses

FMG called itself a global force with thriving communities at the start of 2020 with its people and culture. It leveraged the potential of its valuable asset of human resources to stretch its minerals business targets. Also, high capital and remarkable yield growth were rare in resources sector companies.

Australia's 2020 bushfire season had a devastating effect on people and their communities, including local businesses and wildlife. FMG's team supported those impacted by the bushfires, donating AUD 90,000 to the Red Cross Disaster Relief and Recovery Fund.

Following this, FMG collaborated with Minderoo on the Fire Fund initiative to transform Australia into the global leader in fire and flood resilience by 2025.

Not so long after, FMG and Minderoo worked together again to procure scarce personal protective equipment (PPE) for our frontline carers, nurses, and doctors, helping to protect Australia from COVID-19.

Market Position Strength

Even with the pandemic affecting economies worldwide, FMG integrated its operations at Perth by opening Fortescue Hive.

The company’s privileged position in the industry allowed its supply chain even during the extreme COVID-19 lockdowns. Shipping schedules were never disturbed as FMG fulfilled its commitment to its customers amid the global restrictions.

Back home, FMG continued supporting the Australian economy via profits, taxes, and royalties crossing AUD 21B mark collectively. In June 2020, FMG also announced an industry-leading emissions reduction goal to achieve net-zero operational emissions by 2040.

Running The Show

With pandemic and economic challenges in the background, FMG is massively supporting West Australia in these challenging times. As of 2021, FMG:

  • Is World's first iron-ore company with a completely automatic haulage fleet
  • Has railway capability to carry heaviest faster than any other rail on Earth
  • Made a total economic contribution of 30.2 billion AUD
  • Lowered TRIFR to a historical record of 2.0

FMG's core iron business is continuously driving significant results to benefit its people and environment.

To be carbon-neutral by 2030, FMG is leading the way in renewable and green resources to create the next big export market for the Australian economy.

Key Takeaway 3: Growth With All Stakeholders Involved

From 2016 to 2021, FMG flexed its actual muscles in the market even during the natural and economic calamities that disturbed the world economies and especially Australia.

With substantial stakes in the iron market coupled with remarkable supply chains and backed by the most strong team, the company set the bars high with its record financial progress and sustainable alignment.

FMG family's commitment to meeting major safety, production, and cost targets backed by its ability to challenge the odds are testament to its success.

The Urgent Need For Digitization

Mining is one of the most important industries for the Australian economy. Thus, how large firms, like Fortescue, progress and how the industry overall moves forward, significantly impacts the path the economy of the country follows.

In recent years, one of the key factors driving growth in the mining industry is innovation and digitalization. Fortescue and its competitors have introduced and implemented several new technologies into their operations. However, whether this is enough for the mining giant, or does it need to do more to keep up the pace is another question.

Leveraging Data To Gain An Edge

As AI and tech make their way into the mining world, Fortescue needs to speed up its transition into a modern, fairly automated mining company. As enterprises make the switch, they are greeted by higher productivity, reduced inefficiencies, and a long-term cost reduction. The long list of benefits means that perhaps competitors likes of Newcrest and Rio Tinto will also be making the same transition. Fortescue can gain an edge by pioneering the movement. An initial investment, however, is required.

The mining work has several important components operating simultaneously, generating real-time data. From the trucks and lorries above ground to the nitty-gritty of the tools working in the mines, there is a constant production of data. This, if systematically collected and reported, can be used to digitize the decision-making process and create AI-projected pathways of how the work could expand. For example, if the company embraces state-of-the-art tech and is able to know before drilling about the potential density and amount of iron ore present, it can easily decide if the mining is feasible and the benefits higher than the financial costs involved.

The same digitization tools may also prove imperative in improving communication between the team on differing ground levels. This will reduce the time taken to relay accurate information and thereby prove of much assistance in wrapping up projects within deadline and as stipulated.

For this purpose, the Internet of Things (IoT) can also provide mining companies with a major boost in their production. Fortunately, Fortescue Metals has already made headway in this sphere. While the company purchased SAP Ariba for procurement and ION QMastor for managing the supply chain, it also invested in IoT and has a 5/5 recording score in GlobalData’s Mining Thematic Scorecard. 

Safety and Sustainability Challenges

A company’s future remains hinged upon the well-being of its employees. In the mining sector, the latter is often under concern due to the safety and health challenges presented in mining. In addition, the act of mining also affects the environment. Therefore, the safety of employees and sustainability of the environment proves as a double negative for Fortescue.

Fortunately, the solution can be termed under a single umbrella – digitization.

Using sensors or software to gauge land potential before pushing the drill or sending teams underground can not only prevent teams from suffering excessive and unrequired damages but also provide a relatively clear indication of whether the act of mining is fruitful in the labeled region. The cost-benefit analysis can decrease the negative impact in the long-term and improve Fortescue’s image as a company that not only promotes digitization but also does so responsibly.

Expand Learning

Fortescue Metals has an estimated 6,400 people in its workforce. However, being a mining company focused on iron ore extraction, the majority entails blue-collar workers that are relatively less skilled in managing and operating technology. This can be a hindrance in the company’s transition toward digitization.

One way to improve the company’s position and transition while furthering employee potential can be the use of learning and development programs. This will facilitate the digitization process while preventing a dissatisfied or threatened workforce.

Fortescue's Inroads in Digitalization

Understanding the immense potential in digitalization, Fortescue Metals has already made inroads in this sphere, in hopes of furthering its production and profitability.

In 2012, Fortescue introduced Autonomous Haulage Systems (AHS) tech. What are these? Driverless trucks, basically.

These are less susceptible to health damage, can manage speeds well, and reduce the need for an increasing workforce by manifold – thereby reducing employee costs. In 2020, upon the beginning of the pandemic, the company hit an incredible milestone of converting its 100th truck to driverless with the AHS in Western Australia. From the ideation and inception until today, Fortescue has moved a whopping 1.4 billion tons of material through these trucks, improving productivity levels by a massive 30%!

If there was ever a need for statistical proof that digitalization works – this is it.

A year later, in 2013, the company rolled out real-time reporting tools. These gave Fortescue supervisors a way to gauge operations against production plans and measure performance via business intelligence dashboards almost instantaneously. Earlier, the supervisors had to wait for a minimum of 12 hours for reports to be manually generated in MS Excel and then decide at the end of their shift. However, with the digitized reporting tools, the data was immediately available for viewing at the supervisor’s fingertips, easing the decision-making process, and allowing the company to save monumentally in time costs. Fortescue saved $30 million annually and gained a 10% gain in productivity. This meant their plan of improved production processes was significantly aided by their digitization strategy.

In 2020, the company formed a partnership with Curtin University’s WA School of Mines to create a curriculum that not only addresses current mining concerns but also devises modern methods to forgo them. This would help shape a bright future for the future miners, who would enter the workforce with profound knowledge of digitization and how to inculcate it in otherwise outdated mining practices.

Key Takeaway 4: Embrace Technology For A Newer Growth Trajectory

As tech progresses and businesses accumulate more and more software and digital methods in their production process, Fortescue Metals has been at the forefront in this transitionary period in the mining industry.

The gains of digitalization – reduced costs, increased productivity, and sustainable practices – have been some of the many benefits already enjoyed by Fortescue due to its pro-digitalization policies. This bears proof of the bright future for the company if they are to accept this change in track and expand their horizons.

The move towards digitalization would allow the company to improve its brand image and create a sustainable move in the world of mining.

Growth By Numbers And Key Takeaways

For a company that was established less than two decades, the exponential level of growth that Fortescue has experienced is simply unbelievable.

It stepped into an industry that was already dominated by very huge players. Yet, not only did it manage to create its own place, but it has now become the third-largest iron ore producer in the world.

Of course, the journey here hasn’t been all smooth sailing. Fortescue has faced several challenges, both locally and globally but what has defined the company’s growth is its smart strategies and long-term planning to effectively overcome the obstacles in its way.

File:Fortescue Metals Group.svg
Source: English Wikipedia., Public domain, via Wikimedia Commons

Growth By Numbers

In the last few years, Fortescue’s growth has been rapid despite the outbreak of COVID-19 and the Australian bush fires. In fact, the company has increased its revenues and profits multiple times as well as created many more jobs.

Here is an overview of its inspirational growth in the last three years:





$22.3 Billion

$6.8 Billion

No. of Employees



Net Profit

$10.3 Billion

$0.8 Billion

Total Assets

$28.4 Billion

$17.8 Billion

Key Strategic Takeaways

Fortescue rise to the top of the iron ore industry not only in Australia but in the world has been due to the impeccable strategies that it has implemented consistently at the right times.

We have reviewed several of those key strategies that have propelled the company to its stature today. Here is a recap of them:

Make The Most Of Opportunities

Traditionally, the iron ore and mining industries in Australia have been dominated by a small number of very large players with very little margin for new entrants. Yet, in such a concentrated market, Fortescue was able to not only step into the mining industry but it also, very quickly, became of those leading names.

The driving factor behind FMG managing to grow so quickly was that it found the perfect opportunity or gap in demand and supply and quickly grasped it. China was driving a high global demand for iron and firms in Australia, one of the largest producers exporters of the ore, were unable to keep up with the demand.

This is where Fortescue stepped in, closed the demand-supply bag by bringing in more reserves, and ultimately, followed the same path as the prices of iron ore at the time: rising upwards!

Prepare For Long Haul

Operating in an industry that was highly influenced by big players and events occurring in different parts of the world, Fortescue needed to find stability in its approach to ensure it sustained its growth.

Thus, it sought to establish strategic partnerships around the world which enabled it to safely navigate through major troublesome phases for the global iron ore industry. Most notably, during the first half of the 2010s, Fortescue’s solid partnership with clients in China, bolstered its operations even though competitors struggled.

Also, the company always had other operational strategies in place to control its costs or shift its supply chain whenever prices fell too low or there were other obstacles in demand and supply.

As a result, Fortescue has been able to grow sustainably over the years and kept the impact of the global crisis on its operations as small as possible.

Focus On Growth For All Stakeholders

A key aspect of why Fortescue has been able to develop a brand with such integrity and a positive image is the fact that its policies and strategies are determined by considering all its key stakeholders - particularly in recent years,

It has developed better and safer environments for its workers than its competitors have been able to achieve. It has also played a frontline role in aid and rescue efforts following the catastrophic Australian bush fires and again during the COVID-19 pandemic.

Hence, whether it is workers, clients, or governments, anyone engaging with Fortescue trusts the company to do the right thing. Resultantly, along with prioritizing social welfare, the company has managed to grow beyond expectations in recent years.

Continuously Innovate To Grow

The transition toward digitalization has been crucial in improving the position of Fortescue Metals in the past decade. From investment in reporting tools to accumulating driverless vehicles in the mining process, the move has improved productivity while generating millions of dollars in per annum saving for the company.

Digitalization has opened the path of sustainable growth for the company, and if Fortescue remains on the same trajectory, its future remains bright with exponential gains. Its strategy of partnering with universities offering mining courses especially displays the foresight that the current management has on the future of digitalization, and these moves together will combine to make Fortescue a force to be reckoned with in the global mining sector in the long term.


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