Fortescue Metals Group is facing production cost pressures amid signs iron ore prices are softening from highs that saw it rake in more than $US940 million ($1.2 billion) of net profit in December.

In addition to the production cost pressure, Fortescue has flagged a blowout on the cost and timetable of its $US2.6 billion Iron Bridge magnetite project in WA’s Pilbara region.