Ferrexpo's third-quarter output slumps on logistical challenges

(Reuters) -Ferrexpo Plc said on Thursday its production of iron ore pellets fell sharply in the third quarter, as logistical constraints due to a Russian blockade of Ukraine's Black Sea ports kept the group's business under pressure.

The Ukraine-focussed miner said its iron ore pellet production declined 68% year on year to 800,000 tonnes in the third quarter. Sales fell 65% to 1 million tonnes.

The world's third-largest exporter of iron ore pellets, which has all its operations in Ukraine, has been facing disruptions due to the conflict in the country.

The quarter saw an additional constraint on the Ukrainian railway network with an increase in grain shipments during the harvest season, CEO Jim North said.

He added the group expect to increase ore production once it had "further clarity on logistics corridors".

Brokerage Liberum said iron ore shipments are expected to pick up in the fourth quarter while grain shipments are expected to fall, freeing up logistics and allowing Ferrexpo to raise production.

The miner, which makes pellets used in the steel industry, had said in August it was in advanced talks to restart ocean-bound exports which have been hampered by a Russian blockade of Ukrainian ports.

Shares of the London-listed group were down 1.1% at 130.5 pence in early trade.

(Reporting by Muhammed Husain in Bengaluru; editing by Subhranshu Sahu and Jason Neely)