Atlas up on new ore sales contracts

UPDATE 1.45pm: Shares in Atlas Iron were firmer after the iron ore miner announced the signing of new supply contracts on improved terms.

Atlas said the new contracts were the culmination of recent negotiations with customers after heavily oversubscribed requests for new production, with strong demand for new supply.

"Consistent with the strong demand Atlas received during the negotiation period, the average discount for quality has reduced materially in the new contracts," the company said in a statement.

"Quotation periods for pricing vary from contract to contract but are fixed for each individual contract."

Atlas said the one-to-three year contracts had been signed with a mixture of new and existing counterparties and involved quantities ranging from 400,000tpa to 1.2mtpa.

"The counterparties include a number of Chinese steel mills, trading houses and other international trading houses," the company said.

"Following execution of these agreements approximately 60 per cent of Atlas production is contracted for the 2014 calendar year, with further contracts for up to an additional 20 per cent of production nearing completion and the remaining production to be retained for sale into the spot market."

Managing director Ken Brinsden said it was pleasing to see such strong demand across Atlas' product range.

"We are pleased with the improved financial terms Atlas has achieved in these contracts, which reflects both the reputation of Atlas as a reliable supplier and the strong relationships our marketing team has developed," he said.

Atlas shares were up 8.5 cents, or 7.69 per cent, to $1.19 at the close.