On July 21, the largest South African iron ore producer Kumba Iron Ore Company (KIO), a subsidiary of Anglo American Plc, announced interim results for the first half of 2011. The company increased revenues by 35 percent to ZAR24.1 billion ($3.5 billion). In the first six months of the year, Kumba's operating profit increased to ZAR16.9 billion ($2.4 billion), up 51 percent compared to the same period of the previous year.
Kumba's flagship Sishen mine produced 76.7 million mt iron ore, up 6 percent compared to the first half of the previous year. While total sales volumes for the first half were approximately 22 million mt, export sales volumes from Sishen decreased by 2 percent to 18.4 million mt. Kumba's export sales to China made up 69 percent of total export volumes, compared to 57 percent during the first half of 2010.
According to the company statement, Kumba's Kolomela mine project development remains on target and within budget. 94 percent of the project has been completed.
For the remaining of the year, Kumba foresees a downward pressure on iron ore prices due to seasonally lower crude steel production in the second half of the year. Export sales for 2011 are expected to remain stable with 2010 levels. The company also expects the costs to rise by 25 percent for the full year 2011.