Iluka Resources (ASX:ILU) has lost over 8% in value through Wednesday trade after its quarterly release – and even lower-than-expected output costs and a well-beaten production guidance did little to slow the drop.

The biggest reason for the losses was Iluka’s middling core product production: Zircon, rutile, and synthetic rutile (Z/R/SR) output fell over 20% year-on-year.

So, while the produced 496,000 tonnes did beat guidance (marked at 455K) it was still well over-shadowed by 2023’s far grander 639,000 tonnes.

It could have been even worse though, the miner argued, especially when it came to premium and standard zircon sand sales through the quarter: “Iluka’s disciplined marketing approach has limited the decline recorded for the company’s products while balancing the need to meet customers’ needs and deliver sales revenue.”

Also of particular note, Iluka flagged, was “seasonal weakness” in the quarter.

Some of the market skittish likely also came from Iluka’s look-forward, which came bundled in the same January 22 report – heading into 2025, the $2.13 billion mining giant expects to produce around 495,000 tonnes.

While that is relatively in line with how 2024 played out, investors seem to be generally disappointed that the last year’s weaker output will still continue.

Even worse, the look-ahead warning for the next 12 months came with another cost the company expects to shoulder: Production is going to become more expensive at $680 million annually. That will include $25 million poured into the Balranalda deposit in New South Wales to get it “operationally ready.”

By 11:17 AM in Sydney, Iluka had dropped to $4.88 a share; an 8.27% decline.

There are some hopes within Iluka leadership circles that things will begin to turn around, HotCopper understands. China, India, and Europe have all been noted as strike points for the company to turn demand into dollars.

On China especially, Iluka did mention that “more broadly, stimulus measures in China are likely to have a positive impact” on sales there, though “uncertainty appears to be dominating sentiment” for the time being.

“The economic outlook is already improving in the U.S.,” the Aussie miner added, “although this is yet to translate to an improvement in consumer demand.”

The $400M windfall coming from the Australian government for the Eneabba rare earths refinery in Western Australia may also help keep things heading in the right direction for Iluka; especially considering the project is now fully funded.

Wimmera fieldwork is also wrapped up. Next, an engineering provider will be tapped.

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