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Atlas confident about hitting targetsBy Kim Christian, AAP
Updated April 17, 2013, 11:40 am tweet0EmailPrint
Atlas Iron is confident of meeting its full year targets as it continues talks with Fortescue Metals Group about a Pilbara rail solution.

The Pilbara iron ore miner expects some volatility in the iron ore price but says a new wave of production is unlikely to come on stream as quickly as some analysts believe.

"We don't believe the iron ore price is going to $80 per tonne for any sustained period of time," Atlas Iron managing director Ken Brinsden told reporters after the release of the company's production results.

Analysts have cut their estimates for iron ore prices this year on expectations demand will moderate and steel production will slow in China.

Mr Brinsden said some commentators did not take into account unusual events such as the recent negative production results in Brazil and India exiting the seaborne trade.

Following the release of a rail study by Aurizon, Atlas has been in talks with Fortescue about gaining access to Fortescue's rail network.

"There is a healthy meeting of minds as a result of people's economic imperative changing in light of expectations about iron ore market conditions," Mr Brinsden said.

Fortescue recently said the company wanted to sell a stake in its subsidiary The Pilbara Infrastructure (TPI), which owns and operates the miner's port and rail assets.

Atlas said talks with Hancock were on hold until financing for the Roy Hill project was secured.

In its March quarter results Atlas said it was on track to meet its shipping targets for the year.

The company shipped 1.86 million wet metric tonnes (WMT) of iron ore in the quarter, which was slightly below expectations, and is confident of meeting its target of shipping 7.4 WMT to 7.7 million WMT this year.

It is due to start shipping at an annual rate of 10 million WMT during the September quarter.

In the March quarter Atlas benefited from strong iron ore prices and cost cuts, but production and shipping was affected by Cyclone Rusty and heavy rainfall.

It also endured breakdowns with its processing plant at Wodgina.

Atlas' average headline sale price for its iron ore during the quarter was $US120 a dry tonne.

Shares in the company were three cents lower at 98 cents at 1326 AEST.