Fortescue Metals' cost cutting is delivering benefits to the iron ore miner amid wild movements in the price of Australia's key export commodity.
Recent changes to its rosters and contractor agreements are among measures that helped deliver savings of $US1.6 billion in the past two years, and a further $US1.4 billion ($A1.90 billion) in savings are expected in the year ahead.
The company's cash costs of production dropped 14 per cent to $US22 per tonne in the June quarter, and it expects that to fall again to an average of $US18 per tonne over the 2015/16 financial year.
Total delivered costs, which include shipping, royalty and administration costs, were also lower, at $US28 per tonne in June.
Fortescue estimates its breakeven price in the year ahead is $US39 per tonne, which is well ahead of current prices.
The miner's average realised price in the year to June was $US57 per tonne.
The iron ore market "remained in balance" in the three months to June, Fortescue said, with Chinese port inventories being reduced.
But it warns prices continue to fluctuate.
"Market volatility remains high and continues to be driven by speculation associated with the threat of additional supply driving iron ore futures, together with market concerns over the Chinese economy and the Greek economy," the company said.
Fortescue met its recently increased production forecasts in the year to June, shipping 165.4 million tonnes of iron ore.
It expects to maintain shipments at that level in 2015/16.
Fortescue's net debt at June 30 stood at $US7.2 billion, though recent measures have pushed its nearest maturity date out to 2019.
Shares in iron ore miners were lower on Thursday after an overnight fall in iron ore to just above $US50 per tonne.
Fortescue shares were down 10.00 cents, or 5.71 per cent, at $1.65 at 1524 AEST.
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