New Fortescue chief executive Nev Power has announced that the company was “deeply disappointed” by its recent market performance despite consistently strong share price growth.

 

Speaking at the annual Diggers and Dealers conference in Kalgoorlie, Mr Power said that Fortescue Metals was struggling to convince sceptics and shareholders of its ambitious growth plans over the coming five years.

 

Despite taking a severe battering in the financial crisis in 2008, the mining group has maintained a strong market position this year recording a high of $7.27, up from a low in $1.355 in November 2008. At the time of publication it had fallen back to $5.19.

 

"Our share price has performed spectacularly well by going up two and a half times in the last two years. But let me tell you that we are deeply disappointed in that performance. It should be better, and it will be better," Mr Power said.

 

"As we convince the sceptics that we have continued to deliver on time and on budget, we have continued to do what we have said we are going to do, we've ticked every box and hit every milestone we've put out there, then I think the negative sentiment in terms of our share price will disappear.”

 

Mr Power expressed confidence in the emerging Indian market for iron ore, while also saying that China will continue to push growth in the mining sector.

 

"The best indicator of this is to look at where the new expansions are being made in steel mills in China. They are all on the coast so they can take advantage of larger and larger shipments of iron ore.”

 

Former Fortescue boss Andrew Forrest took the opportunity to once again criticise the Federal Government’s planned minerals resource rent tax (MRRT), saying that price increases will inevitably spill onto commodities other than iron ore and coal.

 

Mr Forrest said that the large mining corporations will offset their losses by claiming depreciating value of their assets.

 

"What we will see is that, for at least the period of the high price level of iron ore and coal, the majors will get a full or almost full shelter from the MRRT,” said Mr Forrest.