This is the end for Australian iron ore mining company Atlas Iron. The junior miner announced it will progressively suspend production at its Pilbara mine sites over the next few weeks, after it was unable to keep up with plunging iron ore prices.
In a statement, Atlas said it would wind down production at its mines sites over the month of April, with exports ending shortly after. All projects will be put on care and maintenance until market conditions improve.
The decision to shut down operations will affect almost 500 staff, including contractors, across its mining operations and another 75 people in its Perth office.
"To suspend our operations, with the impact that will have on so many committed and talented people, is an extremely difficult decision," said Ken Brinsden, chief executive for Atlas Iron.
"I sincerely thank all those who have worked so hard to build Atlas's production base and those who have worked furiously to maintain Atlas's competitive position over the past 15 months, in the face of increasingly oppressive market conditions."
The company went into a trading halt on Tuesday after prices for iron ore dropped to under $50 per ton, despite reducing its break-even point to below $60 a ton.
"Despite an extensive cost-cutting program, to which staff and contractors have made significant contributions, the global supply-demand imbalance for iron ore has driven prices down to the point where it is no longer viable for Atlas to continue production," the company said in the statement.
Atlas’ decision to close its mining operations has prompted Premier Colin Barnett to launch an attack on the top three iron ore companies – BHPBilliton, Rio Tinto and Vale – blaming them for flooding the market.
"I cannot understand the business strategy of the three big major iron ore producers of flooding the market when the market is weak," Barnett said.
"That is just a flawed strategy and not only has it hurt a company like Atlas Iron - dramatically - I think the companies are hurting their own shareholders and indeed the market.'
"The State Government owns the iron ore and we are not willing to simply allow the iron ore continue to be sold at throwaway prices - and that's a pretty clear message to the iron ore industry.
"Don't forget who owns the iron ore, who controls the projects, who controls the ports, who controls tonnages and the like."
According to Atlas, the company will continue discussions with its debt holders over the potential options for restarting its mines and whether further cost reductions are possible.