Death comes knocking for Atlas Iron

Fresh from Atlas Iron:

1

 

Good luck with that! From the AFR:

Smaller producers, including some higher cost Australian miners, want to continue with deals based on longer-term averages of prices, looking to hedge against further falls in the market.

But buyers in the world’s largest consumer of iron ore are having none of it, with many Chinese mills demanding cargoes priced as close as possible to their delivery date.

“Pricing moves around with the steel mills. It used to be all based on a monthly average. Now you find the steel mills and traders perhaps trying to anticipate low points and suggesting quotation periods of maybe two weeks,” said Morgan Ball, chief executive of Australian iron ore miner BC Iron Ltd.

And here is that nice little interactive from UBS and The Australian showing who is next:

Comments

  1. Chopin’s Funeral March or Queen’s “Another One bites the dust”?

    It could be “another one bites the rust”?

    • How about ‘Rust Never Sleeps’?

      “It’s better to burn out
      Than to fade away
      My my, hey hey.

      Out of the blue
      and into the black
      They give you this,
      but you pay for that
      And once you’re gone,
      you can never come back”

  2. Can someone explain to me why a company can voluntarily suspend trading of their shares? Whatever happened to the notion of a free, informed market?

    • Shares can be traded but only off market…. You often have to do that after a removal of a listing to claim a capital loss.

    • Isn’t the point to prevent people working on the review, who will naturally form a view on the company’s future that is dependent on information not freely available, benefitting from that information by trading before the review is finalised and publicised? Or alternatively, a small number of senior officers realise they have market sensitive information they must make available to the rest of the market, but preparing the documents will make a larger group of employees and others temporarily in possession of that information before the market. Hence, the request for suspension, to get the documentation right without increasing the number of people with an informational advantage.

    • @bejome The directors have an obligation to suspend the shares when there is an uninformed market.
      This is to stop trade until the directors provide further information – in this case “a strategic review”
      It’s common practice for takeovers, bank defaults etc

  3. I hadn’t noticed before but Mcaleese Limited, a small mining services company. is probably going to go under when Atlas ceases operations.

    • Weren’t they the outfit operating petrol tankers with shoddy brakes down steep fast flowing suburban intersections? Pure Filth.

      Still plenty of vulnerable dominoes out there waiting to be knocked over. Im also looking at Mineral Resources.

  4. Looks like the word got out on Friday..
    Atlas share holders are shafted, but the directors still draw their fees.WW

  5. Come on guys, sharpen up. Like all commodities there will be different price points. One of the producers you mentioned in the graph produces magnetite at 69%, not 62% fines and it as I understand it still making a profit, even at today’s prices. Thus your generalised comparison is not worth the paper – or there pixels it is written on. Doesn’t help Atlas Iron though.