Fortescue Metals appears to be treading water as the iron ore price plunges to its lowest level in a decade.
Analysts say chief executive Nev Power is looking to slash more costs, which could include job losses, to combat further predicted price falls.
The price of the steel making commodity has dropped to around $US49 a tonne, its lowest level in a decade and below Fortescue's recently declared break-even cost of $US52 per tonne.
Investors are concerned, with the company's shares falling 22 per cent in March, and dropping another 7.5 cents, or four per cent, to a six year low of $1.82 on Thursday.
But UBS analyst Glyn Lawcock says the world's fourth largest iron ore miner is continually removing costs from its business and believes the company is "cash neutral".
"It's very tough at the moment," Mr Lawcock says.
"They're having to work hard to stand still, and it feels like every time they pull costs out of their business and they get their break-even price down, the price falls, so it's like a vicious circle."
Significant price falls could force a fresh round of cost cutting, he said.
Key options for Mr Power in the coming weeks include the deferral of exploration and maintenance expenditure, and improving mining efficiency.
"You can change the way you mine and for short periods," Mr Lawcock said.
However, deferring maintenance could hurt the company later on.
The company has $US1.5 billion ($A1.97 billion) in the bank and no debt repayments due until 2017, meaning it will not to the wall overnight, he said.
The latest iron ore price plunge takes it to almost a quarter of the value experienced during the 2011, when it hit a record above $US185 per tonne.
Forecasters say the price will go lower, with Deutsche Bank predicting a fall to $US40.
The steep falls are a result of the world's largest miners - including Rio Tinto and BHP Billiton - flooding the market with supply while demand from China's steel producers wanes.
Fortescue has also contributed to the oversupply, ramping up production to 164 million tonnes per annum.
The company is the highest cost major iron ore producer, and has $11 billion in debt.
Fortescue's chairman Andrew Forrest, who controversially called for a cap on production last week, has again criticised BHP and Rio, saying they're incinerating shareholder value.
But he had reportedly conceded that using the word "cap" was a mistake.
Share
