Iron fall hits outer industries
Some major Australian transporters are feeling the strain of the ongoing drop in iron ore prices.
One key player – Atlas Iron – has announced it will place its mines into care and maintenance “pending future iron ore market conditions”.
Logistics firms Qube and McAleese say that the suspensions of Atlas Iron’s operations will take a toll on their businesses.
Qube says it hopes to be able to fill the gaps left by the diminishing work for Atlas.
“Qube’s diversification strategy by customer and product continues to mitigate Qube’s risks against such developments,” the company said.
“No customer, including Atlas Iron, represents more than 5 per cent of Qube’s revenues.
“During the financial year to date, Qube handled approximately 16 million tonnes out of the multi-user facility at Utah Point.
“Atlas Iron volumes represented approximately 64 per cent of this volume and Atlas Iron has fully met its minimum volume requirements under the take or pay arrangements with Qube.”
McAleese will be hit hard as well, with Fairfax media reports saying the company had expected the contract with Atlas to make up around 40 per cent of its 2015 earnings.
McAleese is seeking a 10-day voluntary suspension on share trades to allow it time to undertake a review as it “considers and reviews the operational and financial implications and various commercial scenarios that could eventuate”.