Atlas' record output fails to inspire
Atlas Iron was unable to escape the bearish sentiment surrounding iron ore despite posting record production figures for the June quarter and saying it would beat full-year output guidance.
The Pilbara iron ore miner said it had achieved a record 3.1 million tonnes shipped in the June quarter and would post a record 10.9 million tonnes for the 2014 year, up 47 per cent on last year's figure.
The 10.9 million tonnes beat the company's previous full-year guidance of production in a range of 10.2-10.7mt.
The company said its June quarter production showed it had hit its 12mt annual run rate ahead of schedule.
Managing director Ken Brinsden said the strong quarterly and annual production results again demonstrated Atlas' ability to operate existing projects efficiently while developing new mines.
"We believe the combination of our existing operations, our resource base and our outstanding pipeline of growth options puts us in an enviable position among our peer group," he said.
Mr Brinsden said the iron ore market had softened as a result of the additional supply introduced by the major producers over a relatively short period.
This, combined with current credit constraints in China, had led to lower headline prices for the benchmark 62 per cent Fe product and increased discounts for product of Atlas' nature over the second half, and in particular the June 2014 quarter, he said.
"We are confident that the supply and demand balance for iron ore and the 'value-in-use' differential between products of differing grades, means both price and product discounts have likely overshot their natural range," Mr Brinsden said.
"While it is good to see some stability emerge in iron ore markets in recent weeks, we will continue to focus on those matters we can control."
However the news failed to inspire investors with Atlas shares down three cents, or 4.58 per cent, to 62.5 cents at 11.15am.
