(Reuters) – Fortescue Metals Group Ltd (OTC:) Ltd was the fourth largest iron ore miner in the world. On Wednesday, it reported that its first half profit dropped by almost a third due to higher labour and material costs caused by the pandemic.

China’s drive to cut emissions and ease construction activity within the debt-laden country’s property sector resulted in prices of steel-making commodities falling by half last year. Fortescue’s operation was further hampered by the Omicron variant’s COVID-19 waves in Australia.

Analysts believe iron ore prices will stabilize this year but still far from the peak of last year. BHP Group (NYSE 🙂 stated Tuesday that commodity volatility would continue for some time. However, demand for iron ore remains strong and prices will remain stable.

Elizabeth Gaines (Fortescue chief executive officer) stated, “We continue to focus on managing industry costs pressures and challenges that posed by Western Australia’s ongoing border restrictions,” adding that Fortescue is working with the State Government to ensure specialist labour access.

An underlying net profit was posted by the miner at $2.78 billion as opposed to $4.08 billion one year prior. Vuma Financial reports that analysts had predicted a profit in excess of $2.70 trillion.

Fortescue paid an interim dividend in the amount of 86 Australian Cents per share as compared to A$1.47 per shares a year ago.

Company reiterated the company’s annual costs, shipments and capital expenditure projections.