Why Grange Resources (ASX:GRR) reported higher iron ore pellet sales and a North Pit Underground go-ahead in its September quarter

Sonal Goyal

28 October 2026 04:40 PM AEDT

Why Grange Resources (ASX:GRR) reported higher iron ore pellet sales and a North Pit Underground go-ahead in its September quarter

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Key Highlights

Iron ore concentrate production rose to 632 thousand tonnes from 587 thousand tonnes, while pellet sales rose to 732,944 tonnes from 580,239 tonnes.
The board made a final investment decision on the North Pit Underground Project, with underground development forecast to restart in the first quarter of 2027.
Cash and liquid investments were A$300.41 million at quarter end, up from A$267.90 million at 30 June, and unit cash operating cost fell to A$144.80 per tonne.

Grange Resources Limited (ASX:GRR) reported on 28 October 2026 that it produced 632 thousand tonnes of iron ore concentrate in the three months to 30 September 2026, up from 587 thousand tonnes in the June quarter. The quarterly report also noted that the board made a final investment decision on the North Pit Underground Project, which the company had announced on 14 October 2026.

Production and sales

The company said pellet production was 604,184 tonnes, compared with 590,883 tonnes in the previous quarter, helped by operating four furnace lines. Pellet sales rose to 732,944 tonnes from 580,239 tonnes, and chip sales were 77,950 tonnes against 45,488 tonnes. Total product sales were 810,894 tonnes, compared with 625,727 tonnes in June. Grange attributed the higher pellet sales to term offtake agreements and spot sales at premiums to index prices.

Pellet stockpiles fell to 174,643 tonnes from 303,403 tonnes, and the concentrate stockpile fell to 8,982 tonnes from 28,078 tonnes. Weight recovery improved to 41.3 per cent from 34.9 per cent, which the company said offset the effect of minor unplanned maintenance and harder ore on concentrate output. Ore mined rose to 416,039 bank cubic metres from 66,745, while total material movement was lower at 3,123,001 bank cubic metres because of a revised capping and armouring sequence on dump closures. Ex-pit mining ran ahead of plan, the company said.

Costs, pricing and cash

Grange reported a unit cash operating cost, on a C1 basis, of A$144.80 per tonne, down from A$157.69. It noted that C1 excludes mine development, deferred stripping, stockpile movements, royalties, sustaining capital, and depreciation and amortisation. The average realised price, free on board at Port Latta, was US$116.13 per tonne, or A$164.41, compared with US$114.32 and A$160.30 in the June quarter. The average realised exchange rate was 0.7063 Australian dollars to the US dollar. Grange noted that prices are adjusted for freight and final pricing settlements on provisional sales, and that pricing is typically finalised one to three months after shipment.

Cash and liquid investments were A$300.41 million at quarter end, compared with A$267.90 million at 30 June. Trade receivables fell to A$7.82 million from A$23.72 million. About A$15.9 million of planned growth capital expenditure was incurred in the quarter. The company reported no lost-time or disabling injuries.

North Pit Underground Project

The board's investment decision covers a sub-level cave approach, which Grange said requires significantly lower initial capital than the block cave option studied earlier and extends production and pellet supply to 2035. A future block cave remains possible, the company said, but would depend on further studies, funding and a separate investment decision.

The company gave a timetable. Underground development is forecast to restart in the first quarter of 2027, with first sub-level cave ore in 2028 and a ramp-up to about four million tonnes a year by 2030. Open pit mining is expected to finish during 2028. The design, schedule and mining cost estimates were independently reviewed in August 2026, the company said. These dates are forecasts and remain subject to execution.

Southdown and corporate

On the Southdown Magnetite Project, Grange said the search for suitable equity investors is continuing and that tenements, approvals and project assets are being maintained. No investor or funding agreement was reported. The company said it had about 8,450 shareholders at 30 September 2026.

What to watch

The report points to the start of underground development in early 2027 and the progress of the Southdown investor search as the main items ahead. Price outcomes on provisional sales will also be finalised over the following one to three months, according to the company.

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